August 28, 2017
It’s that time of year again- school buses are running and kids are walking to and from school each day. These are good reminders of an often-overlooked tax planning tool that assists some local private schools. The item we are referring to is our local School Tuition Organization (STO) and contributions to it.
The STO is a charitable organization that receives contributions from Iowa taxpayers and allocates those contributions, in the form of tuition grants, to Iowa school children.
Along with the charitable benefit to a school of their choice, donors enjoy a couple of tax benefits. Similar to other charitable contributions, the donor has an itemized deduction on their Federal income tax return. However, the added benefit of the STO is that the donor also gets a 65% Iowa income tax credit for their donation.
Be sure to contact us for additional information on how an STO contribution may help you.