Rhode Island Tax Credits for Contributions to Scholarship Organizations

RI Scholarship Organizations Tax Credit

Provides Rhode Island donors with tax credit support when contributing to qualified scholarship organizations.

The Rhode Island Tax Credit for Contributions to Scholarship Organizations, authorized under R.I. Gen. Laws § 44-62 and administered by the Rhode Island Division of Taxation, allows business entities to receive a state tax credit in exchange for qualifying cash donations to approved Rhode Island Scholarship Organizations (SGOs). For Fiscal Year 2026 (July 1, 2025 through June 30, 2026), the total annual credit pool is $1,324,400. In the prior cycle, demand exceeded the available pool and a public lottery drawing was held on July 24, 2025 at 9:30 AM at Conference Room B, William E. Powers Building, One Capitol Hill, Providence; winning applicants received approval letters with a donation deadline.

Business donation applications are submitted on Form CSO-2, which becomes available July 1 of each fiscal year. Any business entity — for-profit or qualifying nonprofit — may apply; the credit applies to the donor, not to the scholarship organization itself. After making the approved donation, the business must submit to the Division an independent certification by a Rhode Island CPA and a copy of the cancelled check; the Division does not issue the credit certificate until both documents are received. SGOs must separately register with the Division annually, with a December 31 registration deadline, and must appear on the Division's current Qualified Scholarship Organization list before donations are eligible.

Given that the FY2025/2026 cycle was oversubscribed and required a lottery, business entities intending to participate in FY2027 should submit Form CSO-2 promptly when it opens July 1 to maximize their position. Applicants should verify that their target SGO appears on the current qualified list before making a donation, as contributions to an unqualified organization will not generate a credit certificate. Contact: Tax.Credits@tax.ri.gov.