Arizona Tax Credit Series - 2017 Edition

Common AZ Tax Credits updated for 2017 Limits

At our office, I often get asked about the Arizona tax credits, the donation amounts, who to donate to and have to clear up some misinformation about coordination of the credits.  So each year I undertake to write up about the popular AZ tax credits and inform about the changes and increases to those credits.

For starters, these credits qualify the contributor to a dollar for dollar credit against the AZ state income tax (these credits may qualify for a Federal charity deduction, which may result in a tax savings of anywhere from 15% - 39.6% of the donation amounts).  A tax credit is a great tax savings because of that dollar for dollar application, but only if you have income subject to tax in the state of AZ. (Sorry to our neighbors in California or New Mexico)

The credits that I usually point clients to are the following (Credit Title and maximum donation amount for single/married taxpayers):

• Arizona Military Family Relief Fund ($200/$400) 
• Contributions to Qualifying Charitable Organizations ($400/$800) formerly known as the Working Poor Credit - List of organizations here: 2017 Certified Charities
• Contributions to Qualifying Foster Care Organizations ($500/$1,000) - List of organizations here: 2017 Certified Foster Care Charities
• Contributions Made or Fees Paid to Public School ($200/$400)
• Contributions to School Tuition Organization ($1,089/$2,177) - List of organizations here: School Tuition Organization List

The Arizona Military Family Relief Fund, if interested in making that donation, is approaching their cap in donations.  This credit is only allowed to receive up to $1,000,000 in donations each year and must return any excess donations received after reaching that cap, as of 10/19/2017 the fund had received $819,086 in donations.  To make the donation, send a check with the donation form (located here: MFRF 2017 Donation Form.

The other credits I will provide information about in separate blog posting a little later.  

Please consult with a tax advisor (or our office) to see if these tax credits would be beneficial to you and be careful not to do too much in tax credits as these are not refundable (the refund generated from these credits is because of tax withholding or estimated tax payments that have now been offset by these credit donations).