HB 2458 -- Educational Tax Credits

Sponsor:  Jones (89)

This bill establishes the Children's Education Freedom Act which
authorizes a 50% tax credit beginning January 1, 2008, for
taxpayers who donate to a scholarship-granting organization if
the donations are not claimed on the taxpayer's federal income
tax return.  The credit is nonrefundable but may be carried
forward for three years or transferred.  The cumulative amount of
tax credits cannot exceed $40 million annually, adjusted for
inflation based on the federal Consumer Price Index.
Scholarships must average $5,000, adjusted for inflation based on
the index.  The Director of the Department of Economic
Development or a designated oversight organization must establish
a procedure by which the cumulative amount of tax credits is
apportioned among all nonprofit educational assistance
organizations.

Eligibility standards for students receiving scholarships include
residence in a provisionally accredited, unaccredited, or interim
accredited school district; attendance at a public school for the
semester before a scholarship is granted or starting school in
the state for the first time; and a family income of 185% of the
level which qualifies the student for the federal reduced-price
school lunch program.

Scholarships may be given to a disabled child three years of age
or older if the child's parents have nonreimbursed medical
expenses in excess of 7.5% of their federal adjusted gross income
or to a child identified by a principal and approved by his or
her superintendent on the basis of disciplinary or academic
criteria specified in the bill.  Public schools are given the
right of first acceptance of scholarship recipients, and
scholarships may be used at public schools for certain purposes
which include tutoring, general educational development, and
transportation.  Public school districts may opt into the
scholarship program.  Public schools whose students transfer
under the program cannot continue to receive state aid money for
those students beyond the immediately preceding year.

Scholarship-granting organizations must meet requirements for
fiscal soundness, percentage of revenues devoted to educational
scholarships, and public reporting.  Private schools qualify to
accept scholarship students by meeting certain requirements
including employee background checks and student assessments.
The bill specifies how scholarship checks will be distributed.

The provisions of the bill will expire six years from the
effective date, but a child who is receiving a scholarship may
continue in the program until completion of the twelfth grade.

The bill contains an emergency clause.

Missouri House of Representatives
94th General Assembly, 2nd Regular Session
Last Updated October 15, 2008 at 3:12 pm