Editor’s note: This commentary from Tim Benson, a policy analyst at the Heartland Institute, appeared earlier this week on the Institute’s website.
Nebraska legislators are considering a proposal that would establish Opportunity Scholarships, a tax-credit scholarship program for low-income students in the Cornhusker State.
Tax-credit scholarship programs allow qualifying families to pay for tuition and fees at private and parochial schools, as well as at a public school located outside of the student’s school district, using scholarships provided by donors, who, in return, receive tax credits.
Under the proposed program, nonprofit organizations, after receiving approval from the state, would be eligible to grant scholarships to children from families who qualified for benefits from the Supplemental Nutrition Assistance Program.
Beginning in 2022, individuals, married joint-filers, partnerships, limited liability companies, estates, and trusts would donate to these nonprofits in exchange for a 50% tax credit for their income tax liability for that year. Also, “any amount of the tax credit that is unused may be carried forward and applied against the taxpayer’s income tax liability for the next five years immediately following the tax year in which the credit is first allowed.” The total cap on donations would be $10 million.
Currently, with 26 different programs in 21 states and more than 1.2 million scholarships granted, TCS programs are the most popular form of private school choice in the country.
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