Source: http://lis.virginia.gov/cgi-bin/legp604.exe?131+ful+HB1996S1
Timestamp: 2019-03-26 14:43:49
Document Index: 270293715

Matched Legal Cases: ['§ 58', '§ 58', '§ 58', '§ 58', '§ 58', '§ 58', '§ 58', '§ 58', '§ 58', '§ 2', '§ 58']

13105067D
HOUSE BILL NO. 1996 AMENDMENT IN THE NATURE OF A SUBSTITUTE (Proposed by the Senate Committee on Finance on February 12, 2013) (Patron Prior to Substitute--Delegate Massie) A BILL to amend and reenact §§ 58.1-439.20, 58.1-439.24, 58.1-439.25, 58.1-439.26, 58.1-439.27, and 58.1-439.28 of the Code of Virginia, relating to tax credits issued for donations to nonprofit organizations providing assistance to low-income persons.
1. That §§ 58.1-439.20, 58.1-439.24, 58.1-439.25, 58.1-439.26, 58.1-439.27, and 58.1-439.28 of the Code of Virginia are amended and reenacted as follows:
A. For taxable years beginning on or after January 1, 2013, but before January 1, 2018, a person shall be eligible to earn a credit against any tax due under Article 2 (§ 58.1-320 et seq.) or Article 10 (§ 58.1-400 et seq.), Chapter 12 (§ 58.1-1200 et seq.), Chapter 25 (§ 58.1-2500 et seq.), or Article 2 (§ 58.1-2620 et seq.) of Chapter 26 in an amount equal to 65 percent of the value of the monetary or marketable securities donation made by the person to a scholarship foundation included on the list published annually by the Department of Education in accordance with the provisions of § 58.1-439.28. The credit shall be allowed to be claimed for the taxable year following the year of such donation. For individuals and corporations making estimated tax payments pursuant to this chapter, the credit shall be prorated equally against the individual's or corporation's estimated tax payments made in the third and fourth quarters of the taxable year in which the credit may be claimed and the final tax payment.
No tax credit shall be allowed under this article if the value of the monetary or marketable securities donation is less than $500. In addition, no more than $50,000 in tax credits shall be issued to an individual or to married persons in a taxable year. However, such Such limitation on the maximum amount of tax credits issued to an individual shall not apply to credits issued to any business entity, including a sole proprietorship.
C. In a form approved by the Department of Education, the person seeking to make a monetary or marketable securities donation to a scholarship foundation or a scholarship foundation on behalf of such person shall request preauthorization for a specified tax credit amount from the Superintendent of Public Instruction. The Department of Education's preauthorization notice shall accompany the monetary or marketable securities donation from the person to the scholarship foundation, which shall, within 20 days, return the notice to the Department of Education certifying the amount value and type of the monetary donation and date received. Upon receipt and approval by the Department of Education of the preauthorization notice with required supporting documentation and certification of the value and type of the donation by the scholarship foundation, the Superintendent of Public Instruction shall as soon as practicable, and in no case longer than 20 days, issue a tax credit certificate to the person eligible for the tax credit. The person shall attach the tax credit certificate to the applicable tax return filed with the Department of Taxation or the State Corporation Commission, as applicable. The Department of Education shall provide a copy of the tax credit certificate to the scholarship foundation.
A. As a condition for qualification by the Department of Education, a scholarship foundation, as defined in § 58.1-439.25 and included on the list published annually by the Department of Education pursuant to this section, shall disburse an amount at least equal to 90 percent of the amount of each donation for which a tax credit may be received under this article within one year of such donation value of the donations it receives (for which tax credits were issued under this article) during each 12-month period ending on June 30 by the immediately following June 30 for qualified educational expenses through scholarships to eligible students. Tax-credit-derived funds not used for such scholarships may only be used for the administrative expenses of the scholarship foundation. Any scholarship foundation that fails to disburse at least 90 percent of any donated amount within one year the appropriate one-year period shall, for the first offense, be required to pay a civil penalty equal to 200 percent of the difference between 90 percent of the donated amount and the amount that was actually disbursed. For a second offense within a five-year period, the scholarship foundation shall be removed from the annual list published pursuant to this section and shall not be entitled to request preauthorization for additional tax credits, nor shall it be entitled to receive and administer additional tax-credit-derived funds for two years. After two years, the scholarship foundation shall be eligible to reapply to be included on the annual list to receive and administer tax-credit derived funds. If a scholarship foundation is authorized to be added to the annual list after such reapplication, the scholarship foundation shall not be considered to have any previous offenses for purposes of this subsection. The required disbursement under this section shall begin with donations received for the period January 1, 2013, through June 30, 2014.
B. By September 30 of each year beginning in 2014, the scholarship foundation shall provide the following information to the Department of Education: (i) the total number and dollar amount value of contributions received between September 1 of the prior calendar year and September 1 of the current calendar year by the foundation in its most recent fiscal year ended for which tax credits were issued by the Superintendent of Public Instruction, (ii) the dates when such contributions were received, and (iii) the total number and dollar amount of qualified educational expenses scholarships awarded for the school year that began during the current calendar year disbursed by the scholarship foundation during its most recent fiscal year ended. Any scholarship foundation that fails to provide this report by September 30 shall, for the first offense, be required to pay a $1,000 civil penalty. For a second offense within a five-year period, the scholarship foundation shall be removed from the annual list published pursuant to this section and shall not be entitled to request preauthorization for additional tax credits, nor shall it be entitled to receive and administer additional tax-credit-derived funds. After two years, the scholarship foundation shall be eligible to reapply to be included on the annual list to receive and administer tax-credit derived funds. If a scholarship foundation is authorized to be added to the annual list after such reapplication, the scholarship foundation shall not be considered to have any previous offenses for purposes of this subsection.
G. An annual audit, review, or compilation as required by OMB Circular No. A-133 as may be applicable to nonprofit organizations shall be conducted on a scholarship foundation's tax-credit-derived funds. Scholarship foundations that receive donations of marketable securities for which tax credits were issued under this article shall be required to sell such securities and convert the donation into cash immediately, but in no case more than 14 days after receipt of the donation.
H. Each scholarship foundation with total revenues (including the value of all donations) (i) in excess of $100,000 for the foundation's most recent year ended shall have an audit or review performed by an independent certified public accountant of the foundation's donations received in such year for which tax credits were issued under this article, or (ii) of $100,000 or less for the foundation's most recent year ended shall have a compilation performed by an independent certified public accountant of the foundation's donations received in such year for which tax credits were issued under this article. A summary report of the audit, review, or compilation shall be made available to the public and the Department of Education upon request. The As an appendix to the report, the scholarship foundation's board of directors shall include certify (i) (a) the total number and dollar amount value of donations per locality received during the previous calendar year foundation's most recent year ended; (ii) (b) the total number and dollar amount of qualified educational expenses scholarships awarded disbursed during the previous calendar year foundation's most recent year ended to every (a) (1) student whose family's annual household income was not in excess of 300 percent of the current poverty guidelines or (b) (2) eligible student with a disability; and (iii) (c) the percentage of first-time recipients of to whom qualified educational expenses scholarships were disbursed in the foundation's most recent year ended.
H.I. The Department of Education shall publish annually on its website a list of each scholarship foundation qualified under this article. Once a foundation has been qualified by the Department of Education, it shall remain qualified until the Department removes the foundation from its annual list. The Department of Education shall remove a foundation from the annual list if it no longer meets the requirements of this article. The Department of Education may periodically require a qualified foundation to submit updated or additional information for purposes of determining whether or not the foundation continues to meet the requirements of this article.
I.J. Actions of the Superintendent of Public Instruction or the Department of Education relating to the awarding of tax credits under this article and the qualification of scholarship foundations shall be exempt from the provisions of the Administrative Process Act (§ 2.2-4000 et seq.). Decisions of the Superintendent of Public Instruction or the Department of Education shall be final and not subject to review or appeal.
2. That the provisions of this act shall become effective in due course, except that the provisions of this act amending the minimum donation and establishing a maximum amount of donations made by individuals for which tax credits may be issued under the Neighborhood Assistance Act Tax Credit (§ 58.1-439.18 et seq. of the Code of Virginia) program shall become effective for taxable years beginning on or after January 1, 2013.