Alaska Education Tax Credit Program

The Alaska Education Tax Credit Program provides a tax credit to businesses that make contribution to an Alaska accredited nonprofit organization, such as EXCEL Alaska, Inc. It is a great way to ensure Alaska’s youth are prepared for Alaska jobs.

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How much can your company save?

The examples below reflect recent changes to Alaska law- effective January 1, 2011- that provide even greater benefits for schools. In addition to the state tax credit, businesses may qualify for federal tax savings by making charitable cash donations.

The table above assumes an Alaska tax rate of 9.4% and a federal tax rate of 35%. This calculation is simplified actual results may vary depending upon the unique circumstances of each tax payer. Please contact your tax consultant for further information.

How is the education tax credit calculated?

Donations up to $100,000: donors still receive a tax credit of 50%

Donations of $100,00 to $300,000: the new 100% credit applies to the amount of the donation over $100,000 up to $300,000.

Donations of $300,000 to $9,800,000: the new tax credit of 50% applies to the amount of the donation over $300,000. Limited to a maximum credit of $5 million.

Prepared by the Alaska Department of Labor and Workforce Development, Alaska Department of Education and Early Development, and the Alaska Department of Revenue February 2, 2011