Legislation has been enacted that amends the qualified education expenses tax credit available against Georgia corporate and personal income tax liabilities. Applicable to taxable years beginning on or after January 1, 2013, the credit is available to an individual who is a member of an LLC, a shareholder of an S corporation, or a partner in a partnership for the amount expended or $10,000 per year, whichever is less. However, the tax credits are allowed only for the portion of the income on which such tax was actually paid by such member of the LLC, shareholder, or partner. In addition, the aggregate amount of tax credits has been increased from $50 million to $58 million per tax year. Basically from the S Corporation or LLC or Partnership you would need $10,000 divide by 6% = $167,000 of Georgia income to fully utilize the $10,000 credit. And of course you must still go through the approval process with the State of Georgia. The contribution to a qualified organization is typically eligible for a federal charitable contribution deduction (but not for Georgia since you realize the benefit of the credit).
HLB Gross Collins
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