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7) demonstrate its financial accountabil-

parents will provide a detailed listing of all

ity by:

taxpayers claiming tax credits for the educa-

tional expenses of the parents' dependent

a. submitting a financial information

children and/or all scholarship organizations

report for the organization, conduct-

providing funds for the educational expenses

ed by the certified public accountant,

for each dependent child. For each taxpayer

that complies with uniform financial

and/or scholarship organization, parents will

accounting standards established by

list the full name, address, total funds pro-

vided, and date of funding.23

the department; and

b. having the auditor certify that the

report is free of material misstatements.

Section 7: Responsibilities of Taxpayers

Claiming Tax Credits

8) file with the department prior to the

start of the school year financial infor-

A) On a form prescribed by the department, tax-

mation that demonstrates the financial

payers will provide a detailed listing of the schol-

viability of the scholarship organization

arship organization(s), child or children, and fam-

if it is to receive donations of $50,000 or

ily or families to which they provided funds. In

more during the school year.26

each case, taxpayers will list the full name, address,

total funds provided, and date of funding.

B) Notwithstanding the above, each scholar-

Section 8: Responsibilities of Scholarship

ship organization may keep no more than 25

Organizations24

percent of total revenue from the previous fis-

cal year unused in a reserve fund. Any unused

A) Each scholarship organization shall:25

revenue in excess of this amount must be

remitted to the taxpayer on or before a date

one month prior to the tax filing deadline.27

1) notify the department of its intent to

provide educational scholarships to eligi-

ble students;

Section 9: Responsibilities of the

Department of Revenue28

2) demonstrate to the department that it

has been granted exemption from federal

income tax as an organization described in

A) The department shall develop a standard-

Section 501(c)(3) of the Internal Revenue

ized form for education service providers to

Code;

document the amount paid by a parent for

3) distribute periodic scholarship payments

qualified educational expenses.

to parents or education providers serving

specified parents for the specified education-

B) The department shall ensure that parents

al expenses;

are aware of the Public Education Tax Credit

4) provide a department-approved receipt

and that all procedures for claiming the cred-

to taxpayers for contributions made to the

it are easy to follow.

organization;

5) ensure that at least 85 percent of rev-

C) The department shall establish guidelines

enue from donations is spent on educa-

for parents to easily assign their tax credit to

tional scholarships, and that all revenue

their student's qualifying school and to easi-

from interest or investments is spent on

ly adjust their state income tax withholding

to reflect tax credit claims.29

educational scholarships;

6) verify annually by written and signed

statement from each family or guardian

D) The department shall require all scholar-

the total scholarship amount for which

ship organizations to register and annually

each child is eligible according to Section 5;

report the information the department

39