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 can qualify. The current language, which allows organizations that are "qualified to do business" in the state, is being deleted. 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 state and federal antidiscrimination and privacy laws, be registered with the director of charitable trusts, and have approval from the department of revenue administration for issuing scholarships.

The bill is set to take effect on July 1, 2025, and its fiscal impact is indeterminable. Currently, there is only one approved scholarship organization for the 2024-2025 program year, which is incorporated outside of New Hampshire. If this bill is enacted, that organization would be disqualified for the following program year, potentially leading to a positive revenue impact on the Business Enterprise Tax and Business Profits Tax. However, any positive impact from the absence of a qualified scholarship organization could be offset by tax credits that have been carried forward.

Statutes affected:
Introduced: 77-G:1