Public school tax credits are an easy way for taxpayers to make a massive impact on Arizona’s children! The benefit to taxpayers is simple: when you make a cash contribution to a public school, you can receive a nonrefundable tax credit or a dollar-for-dollar reduction in your tax obligation, subject to limits of your tax liability; this means that you get the full amount of your donation back when you file your Arizona income tax return, either subtracted from what you owe or added to your refund. If your allowed credit exceeds your tax liability, you can carry forward any unused credit up to the next five consecutive years. You do not need to itemize your tax return to utilize the tax credit!
Funding for school programs
These donations add up to an estimated $55 million of school funding annually! This funding goes towards field trips, sports, extracurricular clubs, arts programs, kindergarten extension programs, playground equipment, school meal programs, and more. Not only do these programs profoundly affect how kids perform academically, but kids with access to school programs also experience less stress and better health outcomes. It’s a win-win scenario for Arizona taxpayers and the kids!
The maximum donation that can be used towards the public school tax credit is $200 for filing single or $400 for married filing jointly.
Factors that you can consider when deciding which public school to donate to:
- Donating to a public school in a low-income area: Public schools in lower-income areas and elementary schools typically receive the fewest tax credit donations, resulting in less funding for extracurriculars, playground equipment, and school meal programs.
- Donating to the public school(s) that your child(ren) attend: When you make a tax credit donation to a public school, you can specify where you would like the donation to go, including an individual student’s extracurricular activities, field trips, or standardized testing fees.
- You can donate to any public school in Arizona to be eligible for the tax credit!
Here’s a complete list of Arizona public schools eligible for this credit
Claiming the tax credit
Your donation can be made online, by mail, or in person at a public school. However you make your donation, you’ll receive a receipt. You will need to use this receipt to claim the tax credit on your Arizona income tax return. You do not need to itemize to utilize the public school tax credit.
|If you prepare and file your taxes…||If you use tax software to prepare and file your taxes…||If you work with a tax professional to prepare and file your taxes…|
|When you file your taxes, you will use Arizona Form 140 (the longer tax return form) and include Arizona Form 322. You’ll need information from the receipt such as the contribution date, the school’s CTDS code and district name, and your contribution amount.||You will be prompted to enter tax credit information by the software. You’ll need information from the receipt such as the contribution date, the school’s CTDS code and district name, and your contribution amount.|| Give your receipt to your accountant with your other|
Donate by April 18, 2023, to apply the public school tax credit to your 2022 Arizona tax return!