The Arizona Private School Tuition Tax Credit allows Arizona taxpayers to give to AZTO and receive a dollar-for-dollar tax credit against your Arizona Income Taxes. AZTO then issues tuition awards to eligible students attending one of AZTO’s participating schools. For a 90 second overview on Arizona’s Tuition Tax Credit Program, please see AZTO’s Vimeo Video.
How it Works
- You may contribute to AZTO online or by mail with a current year Donation Form to participate in the tax credit program.
- Contributions can be accepted through April 15th for a credit in the previous calendar year. A contribution must either be postmarked by April 15th or received online by midnight on April 15th to be eligible for a credit in the previous calendar year. If April 15th falls on a weekend or holiday, the giving deadline coincides with the federal filing deadline.
- If contributing online, you will receive an email receipt within moments of making the online donation. AZTO annually receipts all contributions by mail in January for all prior year contributions. During the first quarter of the year, AZTO issues receipts monthly by mail for those donations designated for credit in the prior tax year.
- When completing your taxes, use your AZTO receipt to claim the credit. Arizona Forms 301, 323, and 348 are used when claiming the Private School Tuition Tax Credits. These forms become available by the Arizona Department of Revenue each December.
Below are two examples of fictional donors and how the tax credit might work in their situations.
Example 1 – Mike and Jody
Mike and Jody are married and file their taxes jointly. They have withheld $1,000 from their paychecks to pay for their Arizona Income Taxes. They correctly estimate that they have a tax liability of $2,500. For tax year 2019, the State of Arizona allows married couples to contribute up to $2,269 for the private school tuition tax credit program. The following donations to AZTO will have the following results:
Example 2 – Zach
Zach is single and files his taxes as an individual. He has withheld $800 from his paycheck to pay for his Arizona Income Taxes. He correctly estimates that he has a tax liability of $600. For tax year 2019, the State of Arizona allows an individual to contribute up to $1,135 for the private school tuition tax credit program. The following donations to AZTO will have the following results:
Examining Line 49 on the full Arizona Form 140 (2018) is your tax liability and will give you a feel for how much you can donate, as long as it is less than the tax credit’s maximum amount for your filing status. If the donation amount exceeds the tax liability, the difference must be carried over to the following tax year, for up to five tax years. Also, if you donate to multiple types of tax credits, you need to add together all of the tax credits to determine the maximum allowed for that tax year. As always, we recommend you consult with your tax adviser regarding your specific situation. Other credits, deductions, and various factors may apply that would affect your personal result.
If you would like to print these examples: