Big Changes in Arizona’s Charitable Tax Credits

Arizona Tax Credit Program

Arizona’s charitable tax credits have been a major source of funding for Arizona nonprofits in recent years. They are popular with donors because they permit donors to direct a portion of their tax dollars to the organizations they care about most.

The State Legislature recently passed increases to the Arizona Tax Credits. For nonprofits, this means that in order to increase contributions to your organization, your tax credit marketing needs to be reevaluated and addressed now.

This year, tax credit allowances that individuals can take have increased 25%! The legislature also extended donation deadlines to April 15, 2017.

If an Arizona resident takes advantage of all tax credits in 2016, they would be contributing $1635 (single filing status) or $3270 (joint filing status). To truly cash in on this opportunity, nonprofits should actively promote tax credit giving now through a monthly giving campaign.

Let’s take an example of a two-parent working family with three children. Come December, mom and dad are thinking about holiday gift giving”in 2015 an average family added $881 to their regular monthly expenses. Will they be able to write tax credit donations totaling $3200 in addition to the $881 for Christmas?

If you were to begin a monthly giving program promoting your organization’s tax credit campaign now, taxpayers are able to make their gifts over the next eight months to your organization to take advantage of Arizona’s tax credits. Less stress for your donor AND increased revenue for your nonprofit.

Ellis Carter is a nonprofit lawyer with Caritas Law Group, P.C. Ellis advises nonprofit and socially responsible businesses on corporate, tax, and fundraising regulations.  Ellis is licensed to practice in Washington and Arizona and advises nonprofits on federal tax and fundraising regulations nationwide. Ellis also advises donors with regard to major gifts. To schedule a consultation with Ellis, call 602-456-0071 or email us through our contact form.

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