Arizona Tax Credits – Pay State Tax or Donate to a Qualified Charity?

July 21, 2017

If you find yourself owing state taxes at the end of the tax year and are interested in redirecting some of your money away from the government, you’ve found the right article. The State of Arizona offers what they call Arizona Tax Credits, which are dollar-for-dollar tax credits that any taxpayer may take advantage of. Here are some of the details!

As an Arizona resident, you may donate funds to four types of organizations:

Charitable organizations

Public School organizations

Private School organizations

Foster Care organizations

Each year the State of Arizona provides certain threshold amounts that each taxpayer may contribute for each type of organization depending on their filing status. While they update and tend to increase these amounts annually, the amounts for the 2017 tax year are:

2017 AmountsSingle/Head of Household FilerMarried Filing Jointly Filer
Charitable Organizations$400$800
Public School Organizations$200$400
Private School Organizations$1,089$2,177
Foster Care Organizations$500$1,000

Why would I want to do this? Let’s say you are going to owe state taxes of $1,000. Instead of paying the State this amount when you file your tax return, you can donate $1,000 to eligible organizations of your choice. Aside from reducing and possibly even wiping out your state tax liability, you will also be able to include this amount as an itemized deduction on your federal return. Not only is this a benefit to you financially, but is also a great way to redirect your money to an organization of your choice while helping others in need.

Who can I donate to? The Arizona Department of Revenue provides lists on their website each year of eligible organizations for each category. You can view these in your web browser by visiting You can also contact eeCPA to request the lists. We have our preferred charities that we sponsor and would love to invite you to donate to these! We will even process your payments on your behalf as a courtesy service! That way, we will keep track of the donations on your behalf and take the administrative pain away too!

For the 2017 tax year, you’ll want to donate by December 31st in order to claim these amounts on both your state and federal returns. You can still donate by the April filing deadline in 2018, however, the federal deduction will be postponed until the following tax filing.

In order to claim the Arizona Tax Credits, all you need is proof of donation listing the charitable organization and the amount contributed. This usually comes in the form of an emailed receipt or a mailed letter.

Here at eeCPA we think the AZ Tax Credits are a great way to reduce your state tax liability and decide how your money is spent by choosing the organization of your choice!

We are happy to offer suggestions, answer any questions you may have regarding the Arizona Tax Credits, and can even process the payments on your behalf! Please contact our office at 480-596-8299 or for any assistance.