Arizona State Tax Credits

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An individual may claim a nonrefundable tax credit for making  contributions or paying fees directly to a public school in this state  for support of eligible activities, programs or purposes as defined by  statute. The public school tax credit is claimed by the individual  taxpayer on Form 322.  The maximum credit allowed is $400 for married filing joint filers and  $200 for single, heads of household and married filing separate filers. 

For the purpose of claiming Arizona’s tax credit for contributions  made or certain fees paid to a public school, the Arizona Department of  Revenue now requires taxpayers report the school’s County Code, Type  Code, and District Code & Site Number (CTDS) number on Form 322,  which is included with the Arizona income tax return.

The CTDS is a nine (9) digit number that the Arizona Department of  Education uses to identify Arizona public and charter schools.

An individual may claim a nonrefundable tax credit for making contributions or paying fees directly to a working poor qualifying charity.  These organizations assist low-income children, individuals and families.  The QCO tax credit is claimed by the individual  taxpayer on Form 321. The maximum credit allowed is $938 for married filing joint filers and  $470 for single, heads of household and married filing separate filers. 

 This individual income tax credit is available for contributions to  Qualifying Foster Care Charitable Organizations that provide immediate  basic needs to residents of Arizona who receive temporary assistance for  needy families (TANF) benefits, are low income residents of Arizona, or  are individuals who have a chronic illness or physical disability, and  provide immediate basic needs to at least 200 qualifying individuals in  the foster care system.  These donations provide a wide variety of services, clothing, shelter, and furniture to support these kids.  The tax credit is claimed on Form 352.  

The maximum credit allowed: 

$1,173 for married filing joint filers

$587 for single, heads of household, and married filing separate  filers.

Private School nonrefundable tax credits are available to individuals  for contributions made to a Certified School Tuition Organization which  provides scholarships for students enrolled in Arizona private schools from Kindergarten through 12th grade.  

Credit for Contributions to Private School Tuition Organizations (Original Individual Income Tax Credit) & Credit for Contributions to Certified School Tuition Organizations (Switcher Individual Income Tax Credit)

These tax credits are claimed on Form 323 and on Form 348. For tax year 2024, the maximum credit allowed is $1,459 for single, heads  of household and married filing separate filers and $2,910 for married  filing joint filers.  

You can recommend a student or school receive the donation.

 A nonrefundable individual tax credit for cash donations made to the  Military Family Relief fund which is administered by the Arizona  Department of Veterans’ Services.

This credit is open annually until the maximum is reached of $1,000,000.  

The maximum credit allowed:

$841 for married filing joint filers

$421 for single, heads of household and married filing separate filers. 

There  are two separate nonrefundable corporate tuition tax credits for  donations made to Certified School Tuition Organizations which provides  scholarships for students to attend Arizona private schools.  Due to the  statutory caps on the aggregate amount of credits allowed in a fiscal  year, both the low-income corporate tax credits and the  disabled/displaced corporate tax credits must be pre-approved by the  Arizona Department of Revenue.

Credit for Corporate Contributions to School Tuition Organizations (Low-Income)

This tax credit is claimed on Form 335.  Corporations interested in making a donation to a Certified School  Tuition Organization for the low-income tax credit must contact a School  Tuition Organization directly to discuss applying for a corporate  credit donation pre-approval. Corporate partners, S corporation  individual shareholders and exempt organizations subject to unrelated  business taxable income may also be eligible to claim the low-income  corporate credit.

The Low-Income Corporate Tax Credit Cap for FY2023/24 is $158,476,605.

Credit for Corporate Contributions to School Tuition Organizations for Displaced Students or Students with Disabilities

This tax credit is claimed on Form 341.  Corporations interested in making a donation to a School Tuition  Organization for the disabled/displaced tax credit must contact a School  Tuition Organization directly to discuss applying for a corporate  credit donation pre-approval. Corporate partners, S corporation  individual shareholders and exempt organizations subject to unrelated  business taxable income may also be eligible to claim the  disabled/displaced corporate credit.

The Disabled/Displaced Corporate Tax Credit Cap each fiscal year is $6,000,000.

Pre-Approval of Corporate Donations to School Tuition Organizations

Corporations interested in making a donation for either corporate  credit must contact a School Tuition Organization directly to discuss  applying for a corporate credit donation pre-approval. School Tuition  Organizations submit the corporate donation application for credit  pre-approval to the Arizona Department of Revenue.  Pre-approval  applications submitted by a corporation to the Arizona Department of  Revenue will not be accepted.