Dollar for Dollar AZ State Tax Credit
If you pay Arizona State Income Tax you can receive a dollar-for-dollar tax credit for gifts to qualifying charities! That means rather than pay Arizona State Taxes you could allocate those funds to a cause you care about! (This is not a deduction; it is a Tax Credit!)
You can make donations that will qualify for 2024 Arizona Tax Credit until April 15, 2025.
There are four different types of qualified charities that can benefit from your State Tax dollars, and you can get over a $5,000 (married) dollar-for-dollar TAX CREDIT.
The only catch is that the charity does have to register with the state and obtain a qualifying status for the tax credit. Feel free to ask Tiffany for a list of organizations she supports and you can choose from the list provided by the state at https://azdor.gov/tax-credits
C-Corps & S-Corps can get a Dollar-for-dollar ARizona State
Arizona tax law allows S-Corps and LLC’s taxed as S-Corps to receive a full tax credit against their
Arizona Tax Credit Program Facts:
• Donated funds are used to provide much-needed tuition scholarships for low-income and disabled/displaced families attending K-12 schools in Arizona.
• The donation must be made from the S-Corp to Arizona Tuition Connection. $5,000 minimum.
• The S-Corp can either claim the credit against income taxes at the corporate level (income tax reported on an Arizona 120S corporate income tax return) or it may make an irrevocable election to pass the credit through to its individual shareholders.
• Unused credits from contributions can be carried forward for up to 5 years.
• Any prorated share of the credit that would be distributed to non-eligible partners, estates, or trusts are lost.
• There is no maximum donation amount, but the state does assign an annual overall cap. The cap for 2023 is approximately $158M for the low-income and $6M for the disabled/displaced tax credit.
• Corporate tax credits are issued on a first-come, first-serve basis until the cap is reached.
• A corporation can direct its donation to a particular school but cannot direct the donation to an individual student. Additionally, the corporation’s shareholders may not directly benefit from the donation.
