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S. 539
STATUS INFORMATION
General Bill
Sponsors: Senators Matthews, Williams and Patterson
Document Path: l:\council\bills\gjk\20165sd07.doc
Introduced in the Senate on March 7, 2007
Currently residing in the Senate Committee on Finance
Summary: Tax credits
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number
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3/7/2007 Senate Introduced and read first time SJ-9
3/7/2007 Senate Referred to Committee on Finance SJ-9
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 12-6-3542 SO AS TO PROVIDE STATE INCOME, BANK, OR PREMIUM TAX CREDITS FOR DONATIONS TO HISTORICALLY BLACK FOUR-YEAR PUBLIC COLLEGES AND UNIVERSITIES MEETING THE DEFINITION OF A "PART B INSTITUTION" FOR PURPOSES OF FEDERAL AID TO HIGHER EDUCATION.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3542. (A) The General Assembly finds that:
(1) a significant part of the state mission in education has been to enhance excellence in higher education for low-income and educationally disadvantaged students;
(2) certain institutions have played an integral role in offering higher educational access to low-income and educationally disadvantaged students who otherwise might not have been able to obtain a college education, which has resulted in a substantial public benefit;
(3) these institutions provide a unique educational opportunity for these targeted groups of students by offering flexible admission policies, low tuition rates, and small enrollments to ensure smaller class size tailored to the needs of these targeted students;
(4) these institutions are often limited in their abilities to raise funds from their respective student populations from tuition and fees because of the demographic profiles of their students and, as a result, charge tuition rates which on average are substantially lower than those charged by other higher educational institutions in this State;
(5) the federal government has recognized the unique ability of certain institutions to accomplish the important public benefit of enhancing opportunities in higher education for low-income and educationally disadvantaged students;
(6) public educational assistance made available to the institutions that serve these targeted students provides a direct educational benefit to the students by improving the overall quality of their educational experiences by offering enhanced facilities and improved academic instruction; and
(7) it is necessary that the State of South Carolina enable these institutions to effectively partner with the federal government to ensure the continued existence of these institutions in this State, which provide a substantial public benefit to the State by enabling these targeted students to be well educated, to move into the workforce, and to improve the quality of life in South Carolina.
(B) A taxpayer may claim as a credit against his state income tax, bank tax, or premium tax liability, thirty-five percent of all amounts donated to a historically black public four-year institution of higher learning located in this State as defined in Part B, Subchapter 111, Chapter 28, Title 20 of the United States Code. (C) The total amount of credits allowed pursuant to this section may not exceed in the aggregate twenty million dollars for all taxpayers over any five taxable year period with no more than seven million dollars allowed in any one year.
(D) If the amount of the credit determined under subsection (B) exceeds the taxpayer's state income tax liability for the applicable taxable year, the taxpayer may carry over the excess to the immediately succeeding taxable years. However, the credit carryover may not be used for a taxable year that begins on or after seven years from the date of the initial donation. The amount of the credit carryover from a taxable year must be reduced to the extent that the carryover is used by the taxpayer to obtain a credit under this section for a subsequent taxable year.
(E) Notwithstanding the provisions of subsections (B), (C), and (D), if on April first, or as soon after that as the Department of Revenue determines that the total amount of tax credits which may be claimed by all taxpayers exceeds the total amount of tax credits authorized by this section, the credits must be determined and allocated by the department on a pro rata basis. For purposes of this subsection, a public four-year institution of higher learning for which a donation may be claimed as a tax credit pursuant to this section must report all donations made before April first to the Department of Revenue by April tenth, and the department, as soon as reasonably possible, shall inform these institutions of the total of all donations to all institutions for that tax year.
(F) To receive the credit provided by this section, a taxpayer shall:
(1) claim the credit on the taxpayer's annual state income tax, bank tax, or premium tax return in the manner prescribed by the Department of Revenue; and
(2) file with the Department of Revenue and with the taxpayer's annual state income or premium tax return a copy of the form issued by the institution of higher learning confirming the donation by the taxpayer, as provided in subsection (G).
(G) The institution must complete a form prescribed by the Department of Revenue showing for each donation to the institution:
(1) the name, address, and identification number of the taxpayer who made the donation; and
(2) the amount donated by the taxpayer.
(H) A taxpayer may not claim the tax credit provided in this section unless the public four-year institution to which the donation is made, qualifies as an institution of higher learning with a total student population of sixty percent or more low and moderate income students at the time the donation is made.
(I) A taxpayer may transfer or assign the tax credit provided in this section, except that for purposes of a time period within which an act must occur pursuant to this section, the transfer or assignment must relate back to the time of original investment made by the transferor or assignor.
(J) A credit which is disallowed because of this subsection may be carried forward as provided in this section."
SECTION 2. This act takes effect upon approval by the Governor and applies for tax years beginning after 2006.
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