Corporate Donor

Arizona’s business community can assist children obtain a great education and promote school choice.  In 2006, the Arizona Corporation School Tuition Tax Credit Law, A.R.S. Section 43-1183, was passed to allow corporations to receive a dollar-for-dollar tax credit against their state income tax liability.  These funds help eligible children receive a quality private education.

Keys for corporations to understand about the Arizona Corporate School Tuition Tax Credit Program:

  • The corporate donation limitation for the fiscal year ending June 30, 2012 will be $24.8 million.
  • There is no limit to the amount of money a single corporation can donate.
  • Unused credits can be carried forward for up to 5 years.
  • A corporation cannot designate a specific student but can recommend a qualified private school.  If there are qualified children in the recommended school, every attempt will be made to scholarship these students. If there is no more qualified students in the recommended school and if there are additional funds available, the selection committee will scholarship other qualified students at other schools.
  • C-Corps that pay Arizona corporate income tax are eligible to participate in this program.  If the S-Corp files its income tax on a 120 Corporate Income Tax Return, then it can donate money to receive a credit.  If the S-Corp passes its liability through to its individual shareholders or partners, it cannot donate money to receive a credit under this program.

The process for corporations:

  • A corporation contacts AZTO to donate or AZTO solicits corporations for donations.
  • The corporation indicates the amount of donation they wish to make on the Corporate Donor Form and submit form to AZTO.
  • AZTO completes an approval request form created by Arizona Department of Revenue (ADOR) and mails to ADOR by EXPRESS mail.
  • ADOR responds to the request for approval within 20 days.  The request shall be approved if there is credit available under the maximum allocation allowed for the fiscal year.
  • ADOR will fax approval or denial to AZTO.
  • If the donation is approved, AZTO has 10 days to receive the donation from the corporation.  (This is ten calendar days but consideration will be made for holidays that fall in the 10-day period.)
  • AZTO must notify ADOR of receipt of the donation or if AZTO does not receive a timely donation from the corporation.  ADOR needs to be informed of the exact date the donation is received for the statewide donation limit considerations.

Benefits for students:

  • Your business can provide an opportunity for Arizona families have a CHOICE in selecting the school that will best meet the educational needs of their children.
  • Students must live in households with total income less than 185% of the income required to qualify for reduced price lunches.  For example, the income needs to be less than approximately $75,000 for a household of 4, or $88,000 for a family of 5.  In addition to the household income qualification, the student must meet one of the following standards:
    • Attended a public school as a full-time student for at least the first 100 days of the prior fiscal year and then transferred from the public school to a private school; or
    • Is enrolling in a private school kindergarten; or
    • Received a scholarship according to one of the two requirements above if the child continues to attend a private school in a subsequent year.
  • The scholarship limitations for academic year 2011/12 are $4700 for grades k-8 and $6000 for grades 9 through 12. The original law set scholarship limitations that were to be increased by $100 every year thereafter.

Donation Form Click HERE to download Corporate Donation Form.