State of Innovation. EITC. E ducational. I mprovement. T ax. C redit. What is EITC – “Educational Improvement Tax Credit” ??. Simply, businesses that are eligible for this program take their tax dollars that are sent to the state and redirect them t o an educational institution instead.
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What type of business is Eligible ??
Any business that pays the following taxes is eligible!
Corporate Net Income Tax
Domestic and foreign corporations are subject to the corporate net income tax for the privilege of doing business; carrying on activities; having capital or property employed or used and/or owning property in Pennsylvania.
Capital Stock Franchise Tax
These taxes are imposed on corporations with capital stock, joint-stock associations, limited liability companies, business trusts and all other entities classified as corporations for federal income tax purposes that were formed or do business in Pennsylvania.
Bank & Trust Company Shares Tax
The Bank and Trust Company Shares Tax is imposed at a rate of 1.25 percent on every bank and trust company conducting business in Pennsylvania that has capital stock.
Title Insurance Company Shares Tax
Domestic title insurance companies are subject to the Title Insurance Company Shares Tax at a rate of 1.25 percent.
Insurance Premiums Tax
Insurance Premium Tax is a tax on general insurance premiums.
Mutual Thrift Institutions
The Mutual Thrifts Institutions Tax is imposed at the rate of 11.5 percent on savings institutions, savings banks, savings and loan associations, and building and loan associations conducting business in Pennsylvania. Credit unions are not subject to tax. The Mutual Thrift Institutions Tax applies to the net earnings or income received or accrued from all sources during the tax year
“Pass” through Taxes
Subchapter S – A form of a corporation that meets the IRS requirements and that corporation would be taxed under Subchapter S of the Internal Revenue Code. This gives a corporation with 100 shareholders or less the benefit of incorporation while being taxed as a partnership. This means that any profits earned by the corporation are not taxed at the corporate level, but rather at the level of the shareholders, which is also known as an "S corporation". Having S corporation status can prove a huge benefit for a corporation. The corporation can pass income directly to shareholders and avoid the double taxation that is inherent with the dividends of public companies, while still enjoying the advantages of the corporate structure. In order to qualify, a corporation must be a small businesscorporation. This means the following requirements must be met:
Must be a domestic corporation 2) Must not have more than 100 shareholders3) Must include only eligible shareholders 4) Must have only one class ofstock
See attachment in packet
Attention: Dan Seale