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FAQ’s for Taxpayers - Credit For Contributions To A Qualifying Charitable Organization

For a list of Qualifying Charitable Organizations click here.

What is a Qualifying Charitable Organization?

A Qualifying Charitable Organization is a charity that that meets ALL of the following provisions:

  • Is exempt from federal income taxes under Section a 501(c)(3) or is a designated community action agency that receives community services block grant program monies pursuant to 42 United States Code Section 9901.
  • Provide services that meet immediate basic needs.
  • Serves Arizona residents who receive temporary assistance for needy families (TANF) benefits, are low income residents whose household income is less than 150% of the federal poverty level, or are chronically ill or physically disabled children.
  • Spends at least 50% of its budget on qualified services to qualified Arizona residents.
  • Affirm that it will continue spending at least 50% of its budget on qualified services to qualified Arizona residents.

A charity must apply for and meet all requirements of the law to be considered as a Qualifying Charitable Organization. Approved charities’ names are listed on the Department of Revenue’s website.

 

How do I claim the credit for contributions to Qualifying Charitable Organizations?

The credit is available only to individuals. You report the name of the Qualifying Charitable Organization you donated to as well as the dollar amount of your donation to the Department of Revenue on Form 321. You must also total your nonrefundable individual tax credits on Form 301 and include all applicable forms when you file your tax return.

How much can I claim for the credit for contributions to Qualifying Charitable Organizations?

Taxpayers filing as “single” and “head of household” status may claim a maximum credit of $400. Taxpayers filing as “married filing separate” may claim a maximum credit of $400. Taxpayers that file as “married filing joint” may claim a maximum credit of $800.

What is a Qualifying Foster Care Charitable Organization?

A Qualifying Foster Care Charitable Organization is a charity which meets the requirements for a Qualifying Charitable Organization in addition to:

  • Providing ongoing services to at least 200 qualified individuals in the foster care system.
  • Spending at least 50% of its budget on ongoing services to qualified individuals in the foster care system.

A charity must apply for and meet all requirements of the law to be considered as a Qualifying Foster Care Charitable Organization. Approved Qualifying Foster Care Charitable Organizations’ names are listed on the Department of Revenue’s website. A “qualified individual” means a foster child  as defined in section A.R.S. §8-501 or a person who is under twenty-one years of age and who is participating  in a transitional independent living program as prescribed by section A.R.S. §8-521.01.

How do I claim the credit for contributions to Qualifying Foster Care Charitable Organizations?

The credit is available only to individuals. You report the name of the Qualifying Foster Care Charitable Organization you donated to as well as the dollar amount of your donation to the Department of Revenue on Form 352. You must also total your nonrefundable individual tax credits on Form 301 and include all applicable forms when you file your tax return.


How much can I claim for the credit for contributions to Qualifying Foster Care Charitable Organizations?

Taxpayers filing as “single” and “head of household” status may claim a maximum credit of $500. Taxpayers filing as “married filing separate” may claim a maximum credit of $500. Taxpayers that file as “married filing joint” may claim a maximum credit of $1,000.


Do I have to itemize deductions to claim the credit for contributions to Qualifying Charitable Organizations or Qualifying Foster Care Charitable Organizations?

No. Starting with the 2013 tax year, you do not have to itemize deductions to claim a credit for contributions to a Qualifying Charitable Organization. For 2012 and prior, you were required to itemize deductions on your Arizona return in order to claim a credit for contributions to a Qualifying Charitable Organization.

Do I claim my charitable contribution as a tax credit or a deduction?

You may only claim a tax credit for your charitable contribution on your Arizona state return if the organization you donated to is considered a Qualifying Charitable Organization. A complete listing of Qualifying Charitable Organizations is published on the Department of Revenue’s website. Donations made to organizations not listed on the department’s published website are typically allowable as deductions. You cannot claim both a deduction and a credit for the same charitable contribution on your Arizona return.

Can I claim any portion of my contributions to Qualifying Foster Care Charitable Organizations as credit for donations to a Qualifying Charitable Organization?

No. Donations to Qualifying Foster Care Charitable Organizations (QFCO) will be claimed on Arizona Form 352. A contribution to a QFCO does not qualify for, and cannot be included in, a credit claimed on Form 321 for contributions made to a Qualifying Charitable Organization.

Do my contributions to Qualifying Charitable Organizations and Qualifying Foster Care Charitable Organizations influence the amount that can be claimed for each credit?

No. Beginning with the 2016 tax year, donations to Qualifying Charitable Organizations and donations to Qualifying Foster Care Charitable Organizations will be claimed as separate credits with separate limitations for each. Because these are nonrefundable credits, the total amount of each credit that a taxpayer may use for the taxable year cannot be greater than the tax liability shown on the tax return.

How do I know which organizations are eligible for my donation?

You can view the listing of Qualifying Charitable Organizations and Qualifying Foster Care Charitable Organizations on the Department of Revenue’s website at any time. You can also ask the charitable organization to show you a copy of the Qualifying Charitable Organization/Qualifying Foster Care Charitable Organization certificate issued by the Department to the charitable organization. You can also contact the Department of Revenue to see if the charitable organization is certified.

Can I give to a Qualifying Charitable Organization or Qualifying Foster Care Charitable Organization through an umbrella‐type charitable organization?

Yes. You must designate that the donation is directed to a Qualifying Charitable Organization (QCO) or Qualifying Foster Care Charitable Organization (QFCO) that is certified by the Department of Revenue.

What is the period for making eligible contributions?

Beginning with the 2016 tax year, credit eligible contributions made to a Qualifying Charitable Organization or Qualifying Foster Care Charitable Organization that are made on or before April 15th (the 15th day of the fourth month following the close of the taxable year) may be applied to either the current or the preceding taxable year and is considered to have been made on the last day of that taxable year.

Where is the Working Poor Tax Credit?

What was formerly known as the Working Poor Credit is now officially known as the Credit for Donations made to Qualifying Charitable Organizations. This change was made in 2013 to reflect the expansion of the credit to include foster care organizations.

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