This bill amends the definition of a "scholarship organization" for the purposes of the education tax credit by stipulating that only charitable organizations that are incorporated in New Hampshire may qualify. The current language allows for organizations that are either incorporated or qualified to do business in the state. The new definition requires that the organization must be exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code, comply with applicable antidiscrimination and privacy laws, be registered with the director of charitable trusts, and be approved by the department of revenue administration for issuing scholarships.

The bill is set to take effect on July 1, 2025, and its fiscal impact is currently indeterminable. The only approved scholarship organization for the 2024-2025 program year is incorporated outside of New Hampshire, which would disqualify it under the new requirements. This could potentially lead to a positive revenue impact on the Business Enterprise Tax (BET) and Business Profits Tax (BPT) if no qualified scholarship organizations exist. However, any positive revenue impact may be offset by tax credits that have been carried forward from previous years, making the overall fiscal implications uncertain.

Statutes affected:
Introduced: 77-G:1