Oklahoma Education Support Act HB1160
Proposed Legislation from Constitutional Home Educators Alliance
& Representative Rande Worten
We are currently seeking legislators who are willing to support this piece of proposed legislation. If you have influence in the legislative arena and know of anyone that might be interested, please direct them to this page and have them contact us.
CURRENT STATUS OF BILL: This bill has passed the House A&B committee by a nearly 2/3 vote we need boots on the ground to gain support in the Senate and among the House members before it hits the House floor.
Forward by Joseph Ellis, Vice Chair:
The Oklahoma Education Support Act is a proposed bill that will assist Oklahoma families with qualified educational expenses through an income tax credit. The bill assists families with qualified educational expenses whether their children are enrolled in public schools, private schools, or are educated by other means. Its purpose is to provide much needed help to Oklahoma families without adding any significant burden on the state, or any additional regulation on the many educational options available in Oklahoma today. By providing a tax credit and by qualifying the expenses themselves rather than the people or their educational choices, we believe this bill to be fair and most helpful to the broadest spectrum of Oklahomans. We would appreciate your support for this legislation. For more information, please contact Constitutional Home Educators Alliance at email@example.com
We would like to thank the Oklahoma Council of Public Affairs for their assistance with the language of the bill.
Oklahoma Education Support Act
An Act to provide income tax credits for parents or guardians paying certain costs associated with enrollment of their children in prekindergarten through grade twelve public and private schools or costs associated with providing other means of education.
SECTION 1. Education Expenses Tax Credit.
A. For tax years beginning after December 31, 2020, there shall be allowed for any taxpayer a credit against the tax imposed by Section 2355 of this titlefor qualifying educational expenses incurred during the tax year for any child who is eligible to be enrolled in a public school in this State free of charge and who qualifies as the taxpayer’s dependent for federal tax purposes.
B. The maximum education expenses tax credit allowable for each taxable year, including carry-over credits allowed by subsection C of this section, shall be $2,500 per family.
D. If the amount of the allowable credit pursuant to subsection A of this section exceeds the maximum allowable credit pursuant to subsection B of this section, such excess may be carried over, in order, to each of the two (2)subsequent taxable years.
E. Amounts claimed under this section shall not also be itemized as deductions for the same tax year when computing Oklahoma taxable income.
F. As used in this section:
1. “Academic instruction” means instruction in reading, writing, mathematics, science, history, art, music, geography, civics, economics, literature, philosophy, religion, foreign languages, and related subjects.
2. “Close relatives” refers to a person’s children, grandchildren, mother, father, brothers, sisters, aunts, or uncles, whether by blood, marriage, or adoption.
3. “Qualifying educational expenses” include:
a. tuition and fees for concurrent enrollment as described in section 628.13 of Title 70 of the Oklahoma Statutes for a student who meets the requirements set forth in subsection C of that section;
b. tuition and other instructional fees charged by a qualified school;
c. costs associated with activities at a qualified school, including the cost of fees, clothing, and equipment required to participate in athletic teams, musical groups, clubs, or similar school activities;
d. tuition and other instructional fees charged for tutoring, private instruction, or remedial education services for the purposes of academic instruction and not provided by a close relative;
e. costs associated with the provision of instruction by other means in pre-kindergarten through grade twelve directed by the parent or guardian, including the cost of computer equipment, software, online instruction, cooperative educational programs, textbooks, workbooks, curricula, and other written materials used primarily for academic instruction; and
f. costs associated with activities comparable to those defined in paragraph c of this subsection for a student being educated by other means in pre-kindergarten through grade twelve directed by the parent or guardian.
4. “Qualified school” means either a public elementary or secondary school or a private educational program that can be used to satisfy the state’s compulsory school attendance requirements.
SECTION 2. A. The Oklahoma Tax Commission is authorized to require the taxpayer to submit with the tax return copies of such receipts or similar financial documentation as may be necessary to confirm the taxpayer’s statement of the allowable credit.
B. The Oklahoma Tax Commission shall promulgate regulations and develop tax forms, directions, and worksheets as necessary to effectuate the intent of this chapter. The regulations shall modify the state tax forms, directions, and worksheets to provide a convenient way for taxpayers to claim a credit under this chapter; and
C. Regardless of what documentation the Oklahoma Tax Commission may require for purposes of allowing credit for payments of qualifying expenses, no school or other organization shall be required to provide such documentation or otherwise act to facilitate taxpayers’ access to credits under this chapter.
SECTION 3. The intent of the Legislature is that tax credits authorized pursuant to this chapter not result in any additional regulation of public or private schools or of parents’ education decisions, including educating their children by other means.
SECTION 4. A. The Oklahoma Tax Commission shall determine annually by credit type the total amount of credits claimed under this chapter on all state income tax returns and shall report the same to the Secretary of Finance.
B. Within sixty days prior to the start of each legislative session, the Secretary of Finance shall present a report to the Chairman of the Senate Finance Committee and the Chairman of the House Appropriations Committee projecting the total dollar amount of credits expected to be claimed under this chapter on returns for the current tax year and the following tax year as of the date of the report.
Can the tax credit initiate regulation? Will I have to show proof of my homeschooling? No. The tax credit is not based on the method of education you choose, rather the supplies, curriculum, and resources you may need to get the education. No proof will be necessary for anyone participating. It will not bring any more regulation on your method of education than the child tax credit does to your parenting. In addition, we have included language that specifies that a tax credit in no way gives permission or reason for the DOE to regulate or put any type of restrictions or requirements on those who choose to participate.
Do I have to claim the credit on my taxes? No. It is totally a personal choice. If you choose not to claim the credit, you simply would not turn in any educational expenses on your taxes.
What is the difference between a tax credit and a deduction? Tax credits provide a dollar-for dollar reduction of your income tax liability. This means that a $1,000 tax creditsaves you $1,000 in taxes. On the other hand, tax deductions lower your taxable income and they are equal to the percentage of your marginal tax bracket.
As you might imagine, having a tax credit is more valuable. A tax deduction is helpful, since it lowers your taxable income, but it isn't quite the same. Your deduction might not be enough to knock you down a tax bracket, and it simply reduces the amount of money your taxes are figured on.
Do I have to keep a record of all my expenses and turn in receipts? Yes and no. With any type of tax credit based on purchases, you should keep a record just so you know the total amount of expenditures to turn in to your accountant. You do not, however, have to turn in receipts to anyone. I would recommend you keep those receipts with your tax papers. It is no different than itemizing for deductions or a business keeping track of expenses. A total amount is all that is turned in while receipts are kept for proof.
Can a family with multiple children get more than a family with 1? I can’t really answer that one yet as we are still playing with the language. Currently, the language states that the credit is up to $2500 per family, but some legislators have requested that we change that to $500 per student with a cap of $2,500 per family. Either way, the max will be $2,500 per family.
Can a teacher use this for students in the classroom? No. This is for personal family educational expenses. IF, however, a teacher is also a parent of a student, they can claim the tax credit for their own children the same as any other parent.
Can private school uniforms be included? Yes. If they are required, any school uniform can be included as a qualified expense.
Can this be used to pay for a homeschool coop fee or other tutoring expenses? Yes.
Will this help me get a tax refund? No. A non-refundable tax credit is a dollar-for-dollar reduction in your tax liability. If, after figuring your taxes, you see that you have to pay $3,000 in taxes, and you qualified for $900 in educational expenses, then you would reduce your tax liability by $900 to $2,100. If your tax liability was only $800, then it can only reduce your tax liability to $0. Non-refundable tax credits cannot be used to create a tax refund.
What if I have more expenses than the allowable credit? The way this is written, any excess can be carried over, in order, to each of the two subsequent taxable years.
Can I also itemize these expenses as deductions? No. Amounts claimed under this tax credit cannot be itemized as deductions when computing Oklahoma taxable income.
Is this a Federal or State bill? This is strictly for your state taxes.
What supplies would I be able to count toward the credit? Anything that is specific for a purpose and required could be considered a qualified expense. For example (but not limited to) computers, graphing or specialized calculators, curriculum, specialized art supplies beyond crayons and markers, specialized paper such as graphing paper, specialized tools for classes such as carpentry or auto mechanics, etc...regardless of where they were purchased.
Will itemizing rather than taking a standard deduction make a difference in receiving this credit? You can use it whether you itemize or not. Deductions (whether standard or itemized) are used to calculate your taxable income, which then gives you your tax amount from a formula or table. This credit is then used to reduce your taxes owed after calculations are done.
How will they know we have children that qualify? Will we have to turn something in? No. Your children are already listed on your tax return with their SSN and birthdate. That is all the information that is necessary to show that you have children that fall within the school age qualifier. No other information will be required.