Tax credit program aids Louisiana tuition plan

By Peter Finney Jr., Clarion Herald

A change in state law regulating the Tuition Donation Rebate (TDR) Program allows individuals and companies to shift their state tax liability into an easy way to fund scholarships for children of low-income families to attend Catholic or other private schools, said Peter Quirk, development director for the Archdiocese of New Orleans.

Effective Jan. 1, 2018, a revised state law took effect, changing the TDR program from its original establishment as a tax “rebate” program to a tax “credit” program, Quirk said.

“The way it works now is if a person who wants to support having a kid from a low-income family move from a public school to any private school, that person can make a donation to one of the (nonprofit) organizations that administer the program,” Quirk said.

The two nonprofits – ACE Scholarships Louisiana and Arete Scholars Louisiana – accept the applications and administer the programs. Last year, the TDR program paid for 685 students to attend Catholic elementary and secondary schools. Quirk said he hopes the new law will allow 1,800 children to go to Catholic schools in the archdiocese in 2018-19.

Funding for the program comes through private and corporate donations.

For example, Quirk said, if a person has a $5,000 tax liability with the state of Louisiana, “he could give us $5,000 and not pay any state taxes. It washes out the state taxes, plus they get a federal tax write-off because it’s going to 501(c)(3)s (nonprofits) and serves as a deferral of (federal) income tax.”

“It’s a great deal,” Quirk said. “Basically, if you believe in giving a child the opportunity of school choice, it’s a no-brainer.”

Quirk said he is making informational visits with certified public accountants in the area to make them aware of the state law in the hopes they will inform their clients of the option to help a low-income family get a better education for their children.

He also has visited with several law firms who have earned large payouts in the BP Oil settlement cases to make them aware of how they can help children get a better education.

“I feel very good about it,” Quirk said. “Last year, we could not fund all the applications we received. This year we think we will be able to fund the full 1,800, which would be about $7.5 million.”

The deadline to file state tax returns is May 15, but Quirk said many people regularly file extensions or pay quarterly estimated taxes at different times during the year, so the timing of when to take advantage of the program is not a critical factor.

For more information on the TDR program, contact Quirk at 596-3063 or email him at pquirk@arch-no.org.

Peter Finney Jr. can be reached at pfinney@clarionherald.org.

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