After a busy 2017 Special Purpose Entity (SPE) Education Improvement Tax Credit (EITC) growth year for our network of schools we are more convinced than ever that providing SPE EITC tax credits to donors and schools in a network is better than creating a school by school SPE.
2017 pointed out EITC tax credits are more popular than ever before and all indications are 2018 will bring more EITC donors interested in school donations and the related EITC tax credits.
Advantages of a SPE EITC Network
1. Guaranteed access to EITC tax credits. (While the network may run out of credits sooner there is no apply, cross your fingers, pray, and hope you get tax credits.)
2. Pipeline of preordered tax credits that will turn into scholarship dollars for your school.
3. Access to professional assistance with EITC including donor reassurance and information.
4. Cooperation with other schools in maximizing EITC SPE donors for all schools in the network.
5. Possible access to large donors from banks or insurance companies should we be able to obtain a large donation as a network.
6. Proper SPE separation from the school for liability purposes and so the SPE qualifies for the charity exemption with the PA Department of Banking.
7. All SPE tax and legal needs are taken care of for your donors including year round tax support and proper support for donors tax accountants.
8. 100% of all donations go to scholarships to the school of the donors choice. Schools qualify if they are in Pennsylvania, K-12 and charge tuition.
9. Your school is not "going it alone" with EITC SPEs. Your part of a network of schools interested in everyone doing things right and helping each other.
Disadvantages of a SPE EITC Network
1. Everyone shares EITC tax credits in a network versus having your "own" EITC tax credits. If you get credits they last longer but if you don't your donors are frozen out of for the year and your donors have to wait until "next year".
2. Communication with an SPE EITC network outside your area requires extra explanation and communication and sometimes surprises happen if you don't understand how the SPE network functions.
You are welcome to join our SPE network as a donor or school. Our only requirement to be fair to everyone is all SPE tax credits should go thru our network. We rarely agree to help schools with their own SPEs unless we can agree how the schools existing SPE will join our network. There are no special preferences for schools except a limited special preference for existing SPEs that join our network so the merger of the schools SPE with our network is a win win for the school and the network.