OPINION — Qualifying Charitable Organizations in Fountain Hills are local charities that support basic needs for low-income residents, disabled, or those receiving Temporary Assistance for Needy Families (TANF) benefits, allowing taxpayers to claim a state income tax credit for contributions; examples include the Fountain Hills Community Tax Credit Foundation (e.g. code 22465), Extended Hands Food Bank, Hope for Homes and Foster Your Future. All support Fountain Hills members in need. You can find a list of certified QCOs and their codes on the AZDOR website and contribute to receive the credit on Form 321 when you file your AZ income tax return.
The Arizona charitable tax credit was enacted in 1997 as part of the State’s welfare reform legislation. It gives taxpayers a “credit” on their state income taxes for cash contributions to nonprofit 501(c)(3) organizations that spend at least 50 percent of their budgets on services to Arizona residents who receive welfare (TANF) or residents with household incomes below 150 percent of the federal poverty level. A service is cash assistance, medical care, childcare, food, clothing, shelter, job training, job placement, and other assistance that meets immediate basic needs.
The charitable tax credit is applied after the taxable income is calculated and reduces — dollar for dollar — the amount of taxes owed, up to the ceiling on the tax credit.
