Charitable tax credits are a great way to lower your Arizona tax bill and, more importantly, it is a great way to support a good cause. Not only do you benefit from a tax break by choosing the right qualifying charitable organization , but you also support wonderful groups positively impacting the lives of so many in Arizona, like Ryan House.
What is the Arizona Charitable Tax Credit?
The Arizona tax credit is a dollar-for-dollar match. This means that for every dollar you give to a qualifying charitable organization, a dollar comes off your income tax bill. Individual filers can claim a personal tax credit of $400 maximum and joint filers $800 maximum. For example, if you are filing as an individual and were to donate $400 to a qualifying organization, the state of Arizona will take $400 off of your final state tax bill. So, if your state tax bill is $700 for the year and you donated $400 to Ryan House, you’ll only need to pay $300 in Arizona state tax. If your tax bill was $700 for the year and you didn’t donate any money to charity, you would pay $700 in Arizona state tax.
Although your bank account is lighter in either scenario, you get to decide where most of your hard-earned money goes when you donate it. Utilizing the Arizona Charitable Tax Credit costs you nothing, as you’d be paying the same amount of money in taxes no matter what. By taking advantage of charitable tax credits, you allocate your tax dollars to the qualifying charitable organization of your choice, and get peace of mind knowing your money is supporting a good cause.
Is There a Catch?
There isn’t a catch with the tax credit, you just need to be aware of the tax credit limits and make sure you submit your donation on or before April 15th following the close of the taxable year. A married couple filing jointly can get credit for as much as $800 donated to a category known as Qualified Charitable Organizations (QCO). This means that you could donate all $800 to one charity that falls in that category or split it up between multiple charities. A person filing singly can do the same but only up to $400.
There are five total categories that include charitable Arizona state tax credits, each with its own maximum amount. This allows you to use your tax dollars for as much good as possible, as you could donate the maximum to Ryan House (under the QCO category) and still donate to a foster care group, a public school, a school tuition organization, and a military family relief fund.
What Do You Have to Do to Utilize the Credit?
Taking advantage of the Arizona Charitable Tax Credit is very easy. Every charity has a numerical code. When you make a donation, the charity will send you a receipt or thank you note with the amount of your donation and their code. Whether you file your taxes yourself electronically or you go to an accountant, you will be asked for that code. All you have to do is provide that code and your donation amount.
Help the Kids at Ryan House and Cut Your Tax Bill
Start your tax planning right now with charitable tax credits. You can make a donation to Ryan House and make a difference in a child’s life while you take advantage of the charitable tax credit.
Ryan House provides palliative care to pediatric patients at no cost to the family. About 17% to 19% of children in the U.S. have chronic illnesses that they are battling. Ryan House is there when families need support the most. It is the only organization of its kind in the Southwest.
Every year, about $9 million is left on the table that individual taxpayers could have designated for the charity of their choice. Putting your money where it will do the most good and collecting a charitable tax credit is a win-win plan. Contact Ryan House today to learn more about donating through the Arizona Charitable Tax Credit.