In 2016, the Georgia Legislature passed the Rural Hospital Tax Credit Program that provides a state income tax credit that is designed to encourage Georgians to financially contribute to qualified rural hospital organizations. In 2017, the Georgia Hospital Association (“GHA”) worked with Legislators to improve the credit from 70% to 90% of the actual contribution. Individuals can receive up to $5,000 credit and those that are married and filing jointly can receive up to a $10,000 credit. Certain corporate designations can receive a 90% tax credit on contributions, up to a limit of 75% of their Georgia tax liability. The State has allocated up to $60 million in credits for rural hospitals. There are currently 49 eligible facilities.
Corporations are evaluating this program as a part of their tax strategy. GHA has worked with Georgia HEART to make it easier for individuals to contribute to this program. It can be a challenge for anyone to contribute money and then wait until they receive their Georgia State Tax Refund to see the tax benefit. Using payroll deduction for the employee’s state tax withholdings, it is possible for a contributor to make a donation and see very little difference in their take home pay. Participating employees instruct their employer to change their Georgia Tax Withholdings for 90% of the amount they wish to contribute to a qualified rural hospital. These funds are held in a separate account and are then reimbursed back to the employee when they make their contribution. In essence, they are “saving” for their contribution by lowering their income tax withholdings. GHA has implemented this program for their employees.
For more information about the Georgia Rural Hospital Tax Credit Program, including Employer Processing Guidelines and an Employee Giving Guide, please contact Jim Kelly at Georgia HEART (firstname.lastname@example.org).
The above has been adapted and reprinted with express permission from GHA, of which Arnall Golden Gregory LLP is a proud sponsor.