Last week, I chatted with Micah Hill, Kalispell Superintendent of School District 5, about the Innovative Educational Program Tax Credit. The Innovative Educational Tax Credit ushered in through Montana House Bill 279, allows an individual or business to get a 1:1 credit on their 2022 income tax bill for donating to their local school.
If you're wondering exactly what 1:1 means, here's a simple example. Mr. Smith decides he would like to give $1,000 to his kids' school, Russell Elementary, as part of the Innovative Educational Program Tax Credit. So Mr. Smith sends in his information to the school principal, Bill Sullivan, along with his check for $1,000 (see the video and notes below about what information to send). At the end of 2022, when Mr. Smith gets his income tax bill, it will be $1,000 less than the original total tax bill because of the credit from this program will be applied. In fact, if Mr. Smith gives more - say $10,000 - he can stretch that credit out over three years if needed to get the full return.
There are a few important things to know:
1) It's basically a race for each school district to get the tax credits so if you want to take advantage of this program, get your information and money in today. The portal opens January 3, 2022, and pledges are rolling in fast.
2.) Any individual or business can give up to $200,000 but there is only $1 million total - statewide - for the schools to contend for this year. It's a huge opportunity for our schools but it is competitive. So don't wait!
3) This is time-sensitive, and Kalispell Public Schools cannot guarantee that each donation will be able to be entered prior to reaching the $1 million aggregate amount (but they will do their best!).
Here's how it works (Following copy provided by the Kalispell Chamber of Commerce):
KPS is registered on the Montana Department of Revenue’s (DOR) Education Donations Portal.
If you or your business want to make a cash donation to Kalispell Public Schools, send an email to firstname.lastname@example.org and make sure you tell us in writing that it is for “innovative educational programs.” You can send the email anytime. We will be processing these emails on a first come first served basis. There is a chance that the $1 million cap will be met before we can get your donation recorded.
In the email you will need to provide the District with the following information:
Amount of the donation
Your Name (Business Name)
Last four digits of your Social Security Number (SSN) or Federal Employer Identification Number (FEIN)
Your mailing address
Your physical address
Your Email address
KPS must have an actual receipt of a cash donation (or check) before we can pre-register the donation. A pledge or promise of a donation is not sufficient for a PSD or SSO to preregister a donation. Donations can be mailed or brought directly to the District Office at 233 1st Ave E. Kalispell, MT 59901. Our entrance is located on the North side of the County Library Building. If our District office is closed, donations can be dropped in the mail slot to the right of the entrance.
KPS will enter your information in the Education Donations Portal. All information is confidential tax information and will not be shared publicly.
Once the District records the donation, the DOR will preapprove the donation (so long as the individual and statewide thresholds noted above have not been exceeded) and you will receive a confirmation number and receipt that you will include when you file your 2022 taxes.
The statewide aggregate threshold of $1,000,000 is tracked on the DOR Education Donations Portal. You can view how much of the credit has been reserved, how much is available, and how much is pending. More Information can be found on the following links from the Montana Department of Revenue. Tax Credits for Qualified Education Contributions – Guide Education Tax Credit – FAQ Again, this is time-sensitive, and we cannot guarantee that each donation will be able to be entered prior to reaching the $1 million aggregate amount (but we will do our best!). If your donation is not accepted by DOR because the aggregate limit was reached you will not be obligated to make the donation. If you do choose to donate in this way, we express our sincerest gratitude for your support of Kalispell Public Schools.