College Access Tax Credit Fund Overview
The College Access Tax Credit Fund (the Fund) provides a tax credit to taxpayers and businesses who contribute towards California Community College (CCC) students who have a completed the Associate Degree for Transfer pathway to attend a regionally-accredited Historically Black Colleges and Universities, and whom commit to return to the State of California following their studies. The cash contributions are made to the Fund, which is managed by the California Educational Facilities Authority (CEFA). In exchange for the contribution, CEFA will provide taxpayers and business with a College Access Tax Credit (tax credit), which can be used to offset or reduce taxes.
Senate Bill 798 (SB 798), codified under Revenue and Taxation Code sections 17053.86 and 23686, was signed into law by the Governor on September 16, 2014, and became effective immediately as an urgency statute. Senate Bill 81 (SB 81) was signed into law by the Governor on June 24, 2015, amended Revenue and Taxation Code sections 17053.86 and 23686, and added sections 12207, 17053.87, and 23687. SB 798 and SB 81 authorized a tax credit for taxable years 2014 - 2017, based on a percentage of the taxpayer's contribution to the Fund. CEFA is required to allocate and certify the tax credit.
Assembly Bill 490 (AB 490) was signed into law by the Governor on October 6, 2017, which amended Revenue and Taxation Code sections 12207, 17053.87, and 23687, extending the tax credits to taxable year 2022. Assembly Bill 2880 (AB 2880) was signed into law by the Governor on September 30, 2022, which amended Education Code section 69431.7, amended Revenue and Taxation Code sections 12207, 17053.87, and 23687, and extended the tax credits to taxable year 2027. Assembly Bill 1400 (AB 1400) was signed into law by the Governor on September 30, 2023, which added Education Code section 69840 and amended Revenue and Taxation Code sections 69431.7 and 17053.87, which changed the student target population that benefits from contributions to the Fund.
The tax credit is based on the following percentages:
- 60% of the amount contributed by the taxpayer to the Fund for taxable year 2014.
- 55% of the amount contributed by the taxpayer to the Fund for taxable year 2015.
- 50% of the amount contributed by the taxpayer to the Fund for taxable years 2016-2027.
Maximum aggregate amount of tax credits allowable:
- For taxable years 2014-2016: $500 million each year in addition to the amount of any unallocated and uncertified tax credits in the previous tax year.
- For taxable years 2017-2027: $500 million
Application period for the current taxable year:
- March 1, 2024 – January 2, 2025, 5 p.m. PST
- Applications will be processes on a first come, first served basis
CEFA's responsibilities:
- Establish a procedure for taxpayers to contribute to the Fund and obtain a certification for the tax credit
- Adopt necessary regulations
- Allocate and certify tax credits to taxpayers
- Provide to the Franchise Tax Board a copy of the certifications by March 1 of each taxable year
- Provide to the Department of Insurance a copy of the certifications by March 1 of each taxable year