Pennsylvania Revises EITC and OSTC Credit Guidelines for 2020

As a result of circumstances surrounding the ongoing COVID-19 pandemic, Pennsylvania has enacted numerous changes to the Educational Improvement Tax Credit (EITC) and the Opportunity Scholarship Tax Credit (OSTC) programs for 2020.

EITC and OSTC Changes Include:

  • The deadline to make required EITC and OSTC contributions has been extended until the business entity’s tax year-end. Prior guidelines granted 60 days from the date of the application approval letter. If the business did not make its contribution before its year-end, however, the offer is rescinded.
  • Businesses entering the second year of their two-year commitment in 2020 are now permitted to donate a lower amount in year two and still retain the 90% contribution tax credit for both year one and year two. 
  • EITC tax credits are to be applied against the Corporate Net Income tax liability in the tax year in which the contribution is made. In November 2020, however, Pennsylvania issued guidance allowing firms that cannot use tax credits awarded during the 2020-21 or 2021-22 fiscal years to carryforward those credits for two years. 
  • Any business unable to receive its EITC or OSTC approval letter due to remote working status can request an electronic copy via the Tax Credit Division.

Please consult your state and local tax adviser if you have any questions with regard to either the EITC or the OSTC. 

You’ve heard our thoughts… We’d like to hear yours

The Schneider Downs Our Thoughts On blog exists to create a dialogue on issues that are important to organizations and individuals. While we enjoy sharing our ideas and insights, we’re especially interested in what you may have to say. If you have a question or a comment about this article – or any article from the Our Thoughts On blog – we hope you’ll share it with us. After all, a dialogue is an exchange of ideas, and we’d like to hear from you. Email us at [email protected].

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

© 2022 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

our thoughts on
What is the FICA Tip Credit and How Can Employers Take Advantage of It?
Deferring Gain on Sale of Vacation Property
Some Things You Probably Aren’t Thinking About as a Dealer When It Comes to the Rise in Interest Rates
Can Solar Power Assist with the Infrastructure Needed to Charge EVs?
Retail, Tax BY Kristyn Stang
Don’t Overlook the Work Opportunity Tax Credit (WOTC)
Accelerating Charitable Efforts Act Under Consideration
Register to receive our weekly newsletter with our most recent columns and insights.
Have a question? Ask us!

We’d love to hear from you. Drop us a note, and we’ll respond to you as quickly as possible.

Ask us
contact us

This site uses cookies to ensure that we give you the best user experience. Cookies assist in navigation, analyzing traffic and in our marketing efforts as described in our Privacy Policy.