Wednesday, December 5, 2012

2012 Popular AZ Tax Credits

With year-end approaching it is time to be looking at tax moves that can be taken to put you in a better position.  This is a reminder of the tax credits available for charitable contributions to certain causes (available to those indviduals that file and pay Arizona income taxes).


Arizona tax credits are available to reduce your tax liability, but are not refundable. Unused contribution credits roll forward to future years. A taxpayer who makes $1,800 of eligible contributions but has only a $400 liability will reduce their liability to $0 and have $1,200 available for future years. You will find your 2011 State of Arizona tax liability on Form 140 Line 24. If you have any questions, please contact the office.

Working Poor Tax Credit - $200/$400 Single/Married

Qualifying Organizations -
The Working Poor Credit contributions are reserved for charitable organizations that spend at least 50% of their budget on services to Arizona residents who received Temporary Assistance for Needy Families (TANF), households living below a certain income level, or households containing chronically ill or physically disabled children.

School Tuition Organization - $503/$2,006 Single/Married

Qualifying Organizations -

The STO credit changed in the past year. It is now automatically indexed for inflation and there is a new additional tax credit available, increasing the total amount available. The purpose of the credit is to allow students attending underperforming schools to attend private schools based on merit or need, however there is no limitation on who may accept scholarships. Additionally, the contribution can now be made up to the April 15 tax deadline.

Credit for Contributions Made or Fees Paid to a Public School - $200/$400 Single/Married

Any public or charter school

Credit amount benefit the school's general activity fund or designated extracurricular programs such as music, sports, arts, and civic activities. This is a great opportunity for individuals to provide funding for programs they are passionate about or participated in during their high school careers. This is also a chance to support an under-served school that might not otherwise get funding.

Arizona Military Family Relief Fund - $200/$400 Single/Married

Contributions to this fund assist military families during the loss of a loved one, unforeseen financial hardships, or rehabilitation stints. This fund, an incredibly worthy cause, is capped at $1 million dollars of contributions annually.  I urge you to CONTRIBUTE AS SOON AS POSSIBLE. As of December 4, 2012, the fund has received $649,570.73. If your contribution is received subsequent to the fund's cap, your contribution will be returned and the credit will not be available.

If you have any questions about how the tax credits are applicable to your tax return, please contact the office.
Best Regards,