The Oklahoma Equal Opportunity Education Scholarship Act (68 Okla. Stat. §2357.206) (“Scholarship Act”) allows individuals and businesses to receive Oklahoma state income tax credits for donating to a scholarship granting organization (“SGO”) recognized by the Oklahoma Tax Commission. The SGO then uses those contributions to provide scholarships for eligible students to attend a private school.

An SGO is a 501(c)(3) not-for- profit organization approved by the Office of the Secretary of State, the IRS, and the Oklahoma Tax Commission.

The SGO must give a proportion of scholarships to low income students; allow the scholarships to be portable and usable at any accredited private school that accepts the student; assure the integrity of the Board and staff members; and keep full and accurate records.

Oklahoma Islamic School Foundation (“OISF”) is a scholarship granting organization (set up in compliance with the Oklahoma Equal Opportunity Education Scholarship Act) that awards scholarships so that students with financial need can attend one of the two accredited Islamic schools in the state of Oklahoma. Oklahoma Islamic School Foundation is an independent 501(c)(3) organization established to benefit Islamic schools in Oklahoma. The tax identification number for Islamic School Foundation is 46-4736265. The OISF Board will monitor the OISF compliance with the law and ethical standards. The OISF staff will be available to assist all schools to optimize the opportunities created by the OISF. Send general queries: email: info@okscholarship.org

There are 3 eligible accredited Islamic schools that serve students in PreK – 12 to whom we would like to offer scholarships.

A school must sign a Participating agreement with the OISF setting out each party’s responsibilities.

A school must: be accredited by the State Board of Education or an accrediting association within the Oklahoma Private School Accreditation Commission; be in compliance with all applicable health and safety laws and codes; have a stated policy against discrimination in admissions on the basis of race, color, national origin or disability, and ensure academic accountability to parents and guardians of students through regular progress reports.

The Law and the OISF agreement requires schools to state that they will not discriminate in admissions based upon disability. This has caused some concern among schools. It should not. Schools may be concerned that this requirement means they must admit any disabled student regardless of the severity of the disability or the additional resources a school would require to provide. It does not.

We believe that this provision applies ONLY to the educational programs that the schools currently provide. For example, if the school does not provide a disability educational program (i.e., special education), then the anti-discriminatory statement is not applicable as to “disability” as the school does not provide such a program. In other words, schools cannot be expected to accommodate students, for whom the school is not capable of educating.

No.

A student must be of school age, be lawfully present in the United States; accepted by a participating school; and be a member of a household that has an annual income below 300% of free/reduced lunch eligibility – or – be eligible to attend a public school identified as “in need of improvement’ by the No Child Left Behind Act.

Yes, somewhat. The legislation suggests that the dollar amount of scholarships to low-income families” be roughly proportional to the overall state percentage of these families. This is not tracked by school, just by our overall statewide effort. We think this will self-calibrate as schools identify students in need. The upper income limits defining low income families are:

Family size of 2 $33,874
Family size of 3 $42,606
Family size of 4 $51,338
Family size of 5 $60,070

Add $8,732 for each additional family member.

A low income student is defined as eligible for free and reduced lunch. According the federal guidelines that is 185% of the Federal Poverty Level. It is estimated that 62% of public school students in the state meet this standard. The law suggests that roughly 62% of the scholarship fund go to low income students attending private/independent schools.

We will monitor this. It is very likely that this goal will be reached naturally without any intervention, but we intend to still apply 75% of the OPSOS funds to assist these families.

Once a student qualifies for an OPSOS, that student remains eligible until high school graduation, or being 21 years of age, whichever occurs first. Additionally, any siblings automatically qualify. Therefore a family only needs to become eligible once, but they must submit an application annually for each student.

No.

Each student applying to one of the three nationally accredited Islamic schools is eligible to apply for a scholarship from OISF and scholarships will be awarded to both Muslim and non-Muslim students alike. Acceptance into the Islamic school is a prerequisite that must be met before a student will be considered for a OISF scholarship. The school may forward the application, with recommendations, to OISF for review and final action. The only other criteria for receiving a scholarship from OISF is the student’s demonstrated level of financial need for which OISF will rely solely upon family household income and size of family as a proxy. Students with the highest level of financial need will receive larger scholarship awards.

Under the Scholarship Act, for 2014-15, an eligible student to receive up to $7,022 annually, higher than the previous $5,000.00 limit. This is 80% of the statewide annual average expenditure per pupil reported by the State Department of Education of $8,778 per student for 700,000 students in 2018-2019.

The actual scholarship amount will depend upon a number of factors including OISF/participating school success in raising funds each year, the number of eligible students that apply for scholarships, and the level of financial need of the eligible students. The school will propose a scholarship amount, but the final decision will rest with the OISF.

OISF will notify scholarship recipients and the participating school of award amounts as soon as reasonably possible. Scholarship funds will be provided by check made payable to the scholarship recipient and delivered to the Islamic school where the student is enrolled.

No. The scholarships are for tuition and fees. Such scholarships are universally tax-exempt.

These students are eligible for the OISF scholarship. If they are properly certified and documented, “special needs” students may receive up to $25,000 per year for tuition, fees and transportation. Consult the participating school and OISF staff for more information.

Tax credits directly reduce the taxes you pay on a dollar-for-dollar basis. An Oklahoma state income tax credit is like a gift card from the State of Oklahoma that you can use to pay your state income taxes. For example, with a $1,000 tax credit from the State of Oklahoma, you can pay $1,000 in state income taxes.

Tax deductions reduce the base of taxable income upon which you pay taxes, which translates into a reduction on the amount of taxes that you pay; however, the value of tax deductions depends upon a number of factors specific to each taxpayer, including your taxable income which determines your tax rate, the application of phase outs of certain deductions, and whether the alternative minimum tax applies to you.

Both tax credits and tax deductions help to minimize the overall taxes that you pay, but tax credits are much more valuable because tax credits directly reduce your taxes dollar-for-dollar.

Individuals and legal business entities (corporations, limited liability companies and partnerships) can contribute annually to the Oklahoma Private School Opportunity Scholarship and receive a tax credit of up to 50% of the amount contributed for a single year, or 75% for the amount contributed and if the same amount is pledged for and contributed the following year. Individuals can receive a maximum tax credit of up to $1,000 annually, married couples up to $2,000 annually and legal business entities up to $100,000 annually.

The maximum amount of the tax credit depends first on how much you contribute and second on the aggregate amount of contributions to all SGOs in the state each year. Your maximum tax credit will be 50% or 75% of the amount of your contribution. Since 2022, the State of Oklahoma has allocated a total of $25 Million (previously $5 million) in annual tax credits to the Scholarship Act, so if the total of all contributions to SGOs in the state this year exceed the amount for which tax credits have been allocated (for simplicity’s sake, $7.0 Million), the amount of your tax credit will be diminished on a pro-rata basis for each class of donor, so that each class of donor (individual or legal business entities) receives that same percentage of tax credit for their donation. All SGOs are required to file a report with The Oklahoma Tax Commission in January of each year detailing contributions received during the prior calendar year, so the tax commission can determine the actual percentage of tax credit available to donors.

The maximum tax credit will be $1,000 per individual (based upon a $2,000 donation), $2,000 for married couples and “pass through business entities” (based upon a $4,000 donation), and $100,000 for legal business entities (based upon a $200,000 donation).

Effective January 1, 2015, all “pass-through business entities” will be then be treated as all other businesses, and will able to contribute up to $200,000 per year. As always, consult your tax preparer given your specific case.

Also effective January 1, 2015 there is an additional benefit for donors. For a taxpayer who makes a written commitment to contribute the same amount for two (2) additional consecutive years, the credit shall be seventy five percent (75%) of the amount of the allowable contribution the first year, and fifty percent (50%) of the amount of the contributions the following two (2) years.

Starting 2020, the law allows for $25 million tax credits in a year. Previous law allowed for a total of $3.5 million in tax credits for a year. If statewide donations exceed that amount, the amount of your tax credit will be reduced on a pro-rata basis for each class of donor, so that each class of donor (individual or legal business entities) receives that same percentage of tax credit for their donation.

We would hope that the annual tax credits would be increased before that happens.

All SGOs are required to file a report with The Oklahoma Tax Commission in January of each year detailing contributions received during the prior calendar year so the Tax Commission can determine the actual percentage of tax credit available to donors.

Tax credits received from donating to OISF may be used in the immediately following year. For example, tax credits received from donating to OISF in 2022 may be used to offset income taxes on your 2022 Oklahoma tax return filed in 2023. In addition, any tax credit not used in a given tax year may be carried over for up to three years. The tax credit is not refundable; you must use it as an offset to Oklahoma income taxes.

Like other charitable contributions, donations to Oklahoma Islamic School Foundation that are received by December 31, 2022, will count as charitable contribution made during 2022. The tax credit that you get for donating to OISF in 2022 will be known by February of 2023 and may be claimed when you file your tax return for 2022. Federal and state tax deductions for your charitable contribution to OISF in 2022 may also be claimed when filing your 2022 tax returns.

Donors may contribute by mail (by check or credit card) or online (by credit card).

If contributing by mail, send your check made out to Oklahoma Islamic School Foundation (or credit card information) along with a completed donation form to Oklahoma Islamic School Foundation, PO Box 976, Broken Arrow, OK 74013.

To donate online at any time 1) go to the Oklahoma Islamic School Foundation website at www.okscholarship.org/opsos/ and complete the remainder of the donation form to allow for processing of your donation and collection of information required for the tax credit. You may also make a donation on facebook.com/OISFkids and help us save money on credit card processing fees.

Note: Donations made by credit card incur a processing fee of 2.9% + 30¢.

Yes. The Scholarship Act requires that each SGO disburse at least 90% of the money it receives each calendar year in the form of scholarships for eligible students during the following academic year, with no more than 10% of contributions available to pay administrative costs. OISF was developed in a manner to minimize administrative costs. Furthermore, the organization founder has agreed to pay all administrative costs associated with OISF, so 100% (less credit card processing fees) of donations received from people like you will go directly toward scholarships for students in our Islamic schools.

Yes. You may designate a preference for up to 100% of your donated funds to be used for scholarships at particular Islamic schools. OISF will attempt to honor those requests, but may deviate if necessary to remain true to the primary mission of the organization, which is to provide Islamic school scholarships to students most in need of financial assistance, or to meet certain legal requirements. If you elect not to designate preferred schools, your entire contribution will go to the general scholarship fund for distribution to students at all of the Islamic schools based upon where the financial need is greatest.

No. As a 501(c)(3) charitable organization, OISF cannot accept contributions designated for particular individuals.

No. This would be considered an ethical violation of the intent of the law. It is a responsibility of the OISF Board to insure that the funds are raised and disbursed in a transparent and ethical manner. There can be no “quid pro quo” for donations to go to a specific student.

Contributions to OISF are held at the Bank of Oklahoma in accounts designated solely for the purpose of Oklahoma Islamic School Foundation. Donations to specified schools are deposited into individual accounts. All contributions to OISF are deposited into these accounts and all scholarship payments are made from these accounts.

There are various sources of information. You can review the statute itself, Oklahoma Equal Opportunity Education Scholarship Act (68 Okla. Stat. §2357.206). The Oklahoma Tax Commission, which is responsible for carrying out the statute, is another good source of information (www.tax.ok.gov). The Oklahoma Council of Public Affairs (OCPA) and Oklahoma School Choice Coalition helped to get the Scholarship Act passed and can provide details on the law’s history as well as more general information about the school choice movement in Oklahoma (http://www.ocpathink.org/).