Fostering Success Act - A Formal Outline

I. Program Overview and PurposeA. Legislative Basis: Established by Georgia House Bill 424 (also known as the Qualified Foster Child Donation Credit - QFCD). B. Core Objective: To provide a mechanism for Georgia taxpayers to redirect a portion of their state income tax liability to support Qualified Foster Child Support Organizations (QFCSOs) that serve youth transitioning out of the foster care system. C. Unique Value Proposition: It offers a dollar-for-dollar state income tax credit, effectively allowing taxpayers to choose where a portion of their state tax dollars are allocated, directly benefiting vulnerable youth without additional out-of-pocket cost beyond their tax obligation.

II. Beneficiaries: Aging Out Foster ChildrenA. Target Population:1. Youth aged 16 through 18 who are currently in foster care. 2. Former foster children up to 25 years of age who have not been adopted or reunited with their families. 3. Recent Expansion: Includes young adults up to age 25 who spent at least six months in foster care after turning 14, even if they were subsequently adopted or reunified with birth parents. B. Challenges Faced by this Population (Justification for Need):1. High rates of homelessness, unemployment, and incarceration post-aging out. 2. Significant mental health challenges and trauma. 3. Lack of traditional family support systems (e.g., financial, emotional, guidance). 4. Barriers to pursuing higher education or vocational training.

III. Mechanism: Tax Liability Exchange for Direct DonationA. Dollar-for-Dollar Tax Credit:1. Taxpayers receive a 100% credit against their Georgia state income tax liability for approved donations. 2. This is a credit, not a deduction, meaning it directly reduces the amount of tax owed. B. Application Process:1. Pre-Approval (Mandatory): Taxpayers must electronically submit Form IT-QFCD-TP1 via the Georgia Tax Center (GTC) to request pre-approval from the Georgia Department of Revenue (DOR). 2. Designation: Taxpayers designate their chosen QFCSO during the pre-approval process. 3. Donation: Upon DOR approval, the taxpayer has 60 days (or until December 31st of the tax year, whichever comes first) to make the direct donation to the QFCSO. 4. Claiming the Credit: QFCSOs provide confirmation (e.g., Form IT-QFCD-FUND1). Taxpayers file Form IT-QFCD-TP2 with their state tax return. C. Contribution Limits:1. Annual Statewide Cap:* Initially $20 million per calendar year. * Currently $30 million per calendar year (as of early 2025 legislative updates). 2. Individual/Entity Limits (January 1 - June 30):* Single/Head of Household: Up to $2,500 * Married Filing Jointly: Up to $5,000 * Pass-Through Entity Members (not paying at entity level): Up to $5,000 * Corporations/Entities (paying at entity level): Up to 10% of Georgia tax liability. 3. Individual/Entity Limits (July 1 - December 31):* For individuals and pass-through entity members, if statewide credits remain available, the individual limits are lifted, allowing for unlimited contributions (up to the remaining statewide cap). * Corporate limits generally remain at 10% of tax liability.

IV. Utilization of Funds: Direct Support for YouthA. Qualified Expenditures by QFCSOs: Donations are used to provide essential "wraparound services" directly to eligible youth, including: 1. Education: Tuition, books, school supplies, educational scholarships for post-secondary education (public colleges or vocational training). 2. Housing: Transitional living programs, rent, utilities. 3. Vocational Services: Job training, employment support. 4. Basic Needs: Food, transportation. 5. Health & Well-being: Medical services, counseling, mental health care. 6. Mentorship: Structured mentorship programs (with compensation limits for mentors). B. Purpose: To remove barriers for youth aging out of foster care, promote their growth to independence, and prevent negative outcomes such as homelessness, poverty, and substance abuse.

V. Uniqueness and Impact of the ProgramA. Direct Taxpayer Choice: Unlike many charitable deductions, this program allows taxpayers to directly allocate their state tax dollars to a specific cause, fostering a sense of direct impact. B. Dollar-for-Dollar Incentive: The 100% tax credit makes it financially advantageous for taxpayers to participate, as it costs them nothing beyond their existing tax liability. C. Focus on Prevention and Independence: The program strategically targets youth at a critical transition point, providing comprehensive support to prevent negative outcomes and foster self-sufficiency. D. Collaboration: It facilitates collaboration between the state government, non-profit organizations, and individual taxpayers to address a significant social issue. E. Transparency and Accountability: QFCSOs are certified by the state and have reporting requirements (e.g., annual Form 990, public posting of budgets) to ensure accountability for funds received and expended.