Arizona Charitable Tax Credits
As part of tax planning strategies, we encourage our clients, friends, and family to give to their favorite charities for tax deductions. For many Arizona charities, your donation could equal a dollar-for-dollar Arizona tax credit, meaning it is of no additional cost to you to make these donations.
These tax credits are available to individuals who make charitable contributions to certain organizations and schools. Each of these tax credits provides a dollar-for-dollar reduction of your Arizona tax liability (up to your tax liability, subject to limitations). These tax credits effectively redistribute your Arizona taxes from the Arizona Department of Revenue to the charities of your choice.
If you have questions on how these tax credits can be utilized to their maximum potential, please reach out to us to discuss.
Contributions to Qualifying Charitable Organizations (previously called the Working Poor tax credit)
The maximum amount of the credit for 2017 is $800 for married couples ($400 if single).
The Arizona Department of Revenue publishes a list of all Qualified Charitable Organizations each year. The list can be found online at the following address:
Contributions to Qualifying Foster Care Charitable Organizations
An additional credit, over and above the QCO credit described above, is available for contributions made to Qualifying Foster Care Charitable Organizations (QFCO). In addition to meeting the requirements to be a QCO, a QFCO must spend at least fifty percent of its budget on services to foster children in Arizona.
The additional available credit amount for 2017 is $1,000 for married couples ($500 if single).
A list of Qualifying Foster Care Charitable Organizations can be found online at the following address:
Contributions to Public Schools
Arizona provides a credit for contributions made to a public school, regardless of whether you have a child in school. This credit allows taxpayers to make donations in the following year (until April 15th, 2018) to claim a credit against 2017 Arizona tax. Though qualifying for an Arizona credit in 2017, any amounts donated in 2018 to a public school are deductible for Federal purposes in the year made (2018).
The maximum amount of the credit is $400 for married couples ($200 if single).
The Arizona Department of Education keeps a listing of all public and charter schools in Arizona. You can search for a school by name or by location on their website, http://ade.az.gov/edd/
Contributions to School Tuition Organizations
In addition to public schools, Arizona also provides a credit for contributions made to a Private School Tuition Organization (STO) AND a Certified School Tuition Organization. An STO is an organization that provides scholarships to individuals attending a private school. This credit also allows taxpayers to make donations in the following year (until April 15th, 2018) for a credit against 2017 Arizona tax. Though potentially qualifying for an Arizona credit in 2017, any amounts donated in 2018 to a school tuition organization are deductible for Federal purposes in the year made (2018).
The maximum amount of this credit in indexed for inflation. For 2017, the limit for a STO is $1,092 for married couples ($546 if single. An additional credit for Certified STO’s is available for a credit of up to $1,085 for married couples ($543 if single).
A current list of School Tuition Organizations can be found online at:
Contributions to the Arizona Military Family Relief Fund**
The Arizona Military Relief Fund provides financial assistance to families of currently deployed and veteran military service members. Arizona provides a tax credit for contributions to this fund, but the credit is capped at $1,000,000 across all taxpayers per year – once the fund has reached this cap, taxpayers may donate but will not be eligible to take the credit. As a result, we recommend making your donation early in the year if you choose to take advantage of this credit (it typically caps out by Veterans Day). If you send your check in and the annual cap has been reached, your donation check will be returned to you uncashed. Because of this, you need to provide a receipt from Veteran’s Services in order to take the credit.
The maximum amount of the credit for 2017 is $400 for married couples ($200 if single).
The donation form to make a contribution to the Arizona Military Relief Fund can be found online at:
**As of October 31, 2017, the 2017 $1M cap has been reached and this credit is no longer available for individuals to claim 2017 tax credits, although donations are still deductible for federal and state purposes.
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Charities We Support
AA Tax CPA is proud to support all of the amazing, hardworking local charities throughout the valley.