Entities eligible to apply for EITC, OSTC, or Pre-K are operating business firms authorized to do business in the Commonwealth of Pennsylvania that are subject to: Personal Income Tax, Capital Stock/Foreign Franchise Tax, Corporate Net Income Tax, Bank Shares Tax, Title Insurance & Trust Company Shares Tax, Insurance Premiums Tax excluding unauthorized, domestic/foreign marine), Mutual Thrift Tax, Malt Beverage Tax or Surplus Lines Tax. Such business firms include pass-through entities and special purpose pass-through entities.
Special purpose pass-through entities are created for the purpose of making contributions under Article XX-B of the Public School Code of 1949 and whose shareholders, partners or members are composed of owners or employees of other business firms. To receive tax credits, businesses must be approved to make contributions to Scholarship Organizations SO) and/or Educational Improvement Organizations EIO) and/or Pre-Kindergarten Scholarship Organizations PKSO) that are on the list of such organizations published by the Department.
For purposes of the EITC, a "contribution" from a business firm is a donation of cash, personal property or services the value of which is the net cost of the donation to the donor or the pro rata hourly wage, including benefits, of the individual performing the services. No tax credits shall be approved for activities that are part of the applicant business’s normal course of business.
