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Effective January 1, 2011, State Sponsored Incentives Improve for Corporate Contributions to Higher Education


Senate Bill 236, passed last legislative session, provides for a tax credit of 50% for contributions up to $100,000, a 100% credit for contributions between $100,000 and $300,000, and a 50% credit for contributions between $300,000 and $10 million. The bill also clarifies something that had not been clear in statute up to now, that contributions to facilities are eligible for the tax credit.             

Alaska's students benefit from increased funding from and connections with future employers. The University of Alaska, APU, and a wide variety of public vocational/technical programs across the state benefit from increased financial support from the private sector. Businesses benefit from incentives to invest in the development of Alaskans for jobs in our companies. And the state benefits from increased private sector participation in funding important educational programs and facilities here in Alaska.

SB 236 was sponsored in the Senate by the Education Committee-co-chaired by Senators Kevin Meyer (Anchorage) and Joe Thomas (Fairbanks)-and in the House side by Representatives Kathy Munoz (Juneau), Mike Kelly (Fairbanks), Jay Ramras (Fairbanks), and Peggy Wilson (Southeast).

UNIVERSITY OF ALASKA - Tax Credit Information Corporations Can Now Get up to $5 Million in Tax Credits NEW Alaska Educational Tax Credit Benefits beginning January 1, 2011 till December 31, 2013

The legislature expanded the Alaska Higher Education Tax Credit to increase the credit amount for corporations making contributions in support of education. The revised law will allow companies to take up to a $5 million tax credit when they support the University of Alaska. Further changes include: the addition of the term 'facility' to some sections to allow support of educational facilities, and the allowance for the tax credit to be applied towards multiple taxes paid by a company.

Here's how it works:

If you make a contribution to the University of Alaska and pay any of the taxes listed you can claim the Alaska Educational Tax Credit as follows:

  • 50% of contributions up to $100,000
  • 100% of contributions $100,000 - $300,000
  • 50% of contributions $300,000 - $10,000,000
For example, suppose in one year your company owes the state of Alaska $200,000 in taxes (any of the taxes listed) and you make a $200,000 contribution to the University of Alaska. You can then claim a credit against your state tax liability of $150,000 (50% of the first $100,000 plus 100% of the second $100,000 of your gift = $150,000). Each contribution you make to the University of Alaska may be claimed for credit on only one of the state taxes listed. The maximum tax credit which may be claimed in any one tax year is $5 million.

The Bottom Line: You have benefited the University of Alaska with a $200,000 gift and your tax bill has been reduced from $200,000 to only $32,500*.

This chart of sample gifts shows how you can extend your gift through the use of the tax credit.
Gift Amount Alaska Education Tax Credit Net cost of contribution using only ETC Estimated Federal Tax Savings* Total Tax Savings Net cost of contribution $10,000 $5,000 $1,750 $6,750 $6,750 $3,250 $50,000 $25,000 $25,000 $8,750 $33,750 $16,250 $100,000 $50,000 $50,000 $17,500 $67,500 $32,500 $200,000 $150,000 $50,000 $17,500 $167,500 $32,500 $500,000 $350,000 $150,000 $52,500 $402,500 $97,500 $1,000,000 $600,000 $400,000 $140,000 $740,000 $260,000 $10,000,000 $5,000,000 $5,000,000 $1,750,000 $6,750,000 $3,250,000 *The Estimated Federal Tax Savings for the charitable contribution is calculated using an assumed rate of 35%. The Estimated Federal Tax Savings is calculated using the Net Cost of the Contribution and applying the assumed rate.

Calculate your savings with our ETC Calculator!!!
If you would like to have an estimate on how much you would save using the ETC, click here to use our calculator.

Image of Text:  Giving to the University of Alaska.  A Win/Win/Win investment.The town of Dillingham, on the shores of Nushagak Bay in southwest Alaska, is home to UAF's Bristol Bay Campus

The town of Dillingham, on the shores of Nushagak Bay in southwest
Alaska, is home to UAF's Bristol Bay Campus. Credit: UAF Photograph.

You Win. UA Wins. Alaska wins. Here's why:

Your charitable donation will lessen your tax burden. The tax benefits chart above shows just how substantial the tax savings could be from your gift. Your tax bill could be reduced by up to 80%, depending on your level of giving. ROI.

Gifts can be designated to industry-related programs. You have the option of directing your donations to programs of study at the University that tie directly to your field. You can be as specific as designating student support, faculty support or general program support. It is as your discretion. These programs will in turn produce the workforce that will benefit your company. ROI.

Your support can even be community specific. You can designate your contribution to University of Alaska programs that operate in specific Alaska communities that you wish to support. ROI.

Your giving options are almost unlimited. The University of Alaska can help you choose which programs are most aligned with your corporation or areas of interest.
Dancers enjoy the live music and the surroundings during the chancellor's Dancing with the Cars gala at the Fountainhead Antique Auto Museum in Fairbanks.
Dancers enjoy the live music and the surroundings
during the chancellor's Dancing with the Cars gala
at the Fountainhead Antique Auto Museum in Fairbanks.
Credit: UAF Photograph.

Beyond the financial benefits you receive, partnering with the University of Alaska brings many other returns on your investment. You will be helping grow in-state Alaska employees through workforce training. There is also the gratification that comes from knowing your generosity is making a difference in Alaska's future, as well as impacting the lives of Alaskan students and contributing to the success of higher education in the state.

There is a positive residual value in being aligned with the University of Alaska, giving your company an esteemed standing in the community. And as a corporate partner, you will receive invitations to key University events and recognition in a variety of publications. A University of Alaska liaison will be available to help you make the most of your gift and your relationship with the University.

Additionally, we will report back to you on how your gift was used. You could meet scholarship recipients, or take a tour and see the new equipment your gift helped to purchase. The University of Alaska is experienced in working with our corporate partners and will make it a priority to keep you as informed as you wish to be.

Image of Text that lists the contact info for the four different advancement offices at UA

» Educational Tax Credit Brochure (pdf)

- Making A Gift

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