How does a tax credit scholarship work?

Student Funding

Scholarship funding relies on contributions made by insurance companies to the Scholarship Granting Organization, in return for an 80 percent tax credit for contributions made in that fiscal year. Only companies that are liable to pay the insurance company premium and annuity tax may claim the credit. The program is currently capped at $2 million.

The average value of all individual scholarships awarded would be worth up to 82.5 percent of the state’s share of the per-student allocation.