HB330: HB330 Income tax; credits for contributions to law enforcement foundations; revise provisions

Georgia currently offers income tax credits to individuals and businesses that donate to certain nonprofit groups: organizations that award scholarships to public school students, and foundations that support local police and sheriff's departments. This bill rewrites both credit programs in the state tax code (O.C.G.A. § 48-7-29.21 and § 48-7-29.25). For school donation credits, it sets a flat $20 million yearly statewide cap in place of the current tiered limits, and cuts the maximum credit a corporation can claim from 75 percent of its tax liability to 30 percent. For law enforcement foundation credits, it broadens which foundations qualify (including statewide support foundations), adds new allowed uses of the money such as community engagement events and joint police-behavioral health emergency teams, and extends the program four years, through 2031. Both programs would no longer let taxpayers carry unused credit forward to future tax years. The changes would take effect July 1, 2025, and apply to tax years starting on or after January 1, 2026.

• Sets the annual statewide cap on public school donation tax credits at $20 million, replacing the prior $5 million and $15 million tiered limits.
• Cuts the maximum donation tax credit corporations can claim, from 75 percent of their income tax liability to 30 percent, for both the school donation and law enforcement foundation programs.
• Eliminates the option to carry an unused tax credit forward to the next three tax years under both the school donation credit and the law enforcement foundation credit.
• Broadens which law enforcement foundations qualify for the tax credit, including foundations that support law enforcement statewide rather than only a single local agency.
• Adds new categories of spending that qualify for law enforcement foundation contributions, including community engagement activities and joint law enforcement and behavioral health emergency response teams.
• Extends the law enforcement foundation tax credit program from a 2027 sunset to a 2031 sunset.

Individual and corporate taxpayers who donate to public school scholarship organizations or to law enforcement foundations, the nonprofit foundations and scholarship groups themselves, local police departments and sheriff's offices that receive foundation funding, and the Georgia Department of Revenue, which administers the preapproval process.

Corporations that give large sums to these programs would see their maximum credit shrink, likely reducing incentive for big-dollar corporate donations. At the same time, more law enforcement foundations could qualify for donations, new spending categories are allowed, and the program would run four more years, potentially channeling more private money to police departments statewide.

• Section 1 revises O.C.G.A. § 48-7-29.21 to cap corporate school donation credits at 30 percent of tax liability (down from 75 percent) and sets a flat $20 million annual aggregate credit limit.
• Section 1 removes the ability to carry forward unused school donation credits to future tax years.
• Section 2 revises O.C.G.A. § 48-7-29.25's definition of qualified law enforcement foundation to include foundations serving law enforcement statewide, not just a single local unit.
• Section 2 expands qualified expenditures to include community engagement leases/purchases and costs of emergency response teams combining officers and behavioral health specialists.
• Section 2 extends the tax credit period for law enforcement foundation contributions from ending December 31, 2027 to ending December 31, 2031.
• Section 2 lowers the corporate/entity credit cap for law enforcement foundation contributions from 75 percent to 30 percent of tax liability and removes carry-forward of unused credits.
• Section 3 sets the effective date as July 1, 2025, applicable to taxable years beginning on or after January 1, 2026.

1. 2025-04-04House Withdrawn, Recommitted (House)
2. 2025-03-06House Committee Favorably Reported By Substitute (House)
3. 2025-02-11House Second Readers (House)
4. 2025-02-10House First Readers (House)
5. 2025-02-06House Hopper (House)

• Charles Cannon (R, HD-172)Primary sponsor
• Houston Gaines (R, HD-120)
• Marcus Wiedower (R, HD-121)
• Clint Crowe (R, HD-118)
• Eddie Lumsden (R, HD-012)

• tax credits
• law enforcement funding
• public school scholarships
• income tax law
• police foundations