The Annual Tax Credit Roundup Column
I got shortened this week by my editor. I suggested 5 things you should do before year-end, and the last one, giving blood, got cut. (He chopped out the blood donation, forgot to change the 5 things to 4 in the opening paragraph, and cut the crack about the public school credit helping the richer get richer. Sheesh.) I also had to submit my column before I got my neighbor's annual pitch for the Family School, so I'm giving you the column the way it should have run, not as it did.
Arizona residents should do all 5. Out of state readers still can give blood or make a deductible (but not fully refundable) contribution to these good causes.
USE BAD LAW TO DO SOME GOOD
East Valley Tribune, Dec. 7, 2003
It’s time for your annual reminder about the dizzying variety of state income tax credits letting you do good, for free. Anyone itemizing deductions (and without Alternative Minimum Tax liability) can make lots of state tax liability disappear. It’s foolish public policy, but it’s the law, so do the right thing -- at least five times -- by December 31.
First, there’s a credit (up to $625 for married couples filing jointly, $500 for individuals) for donations to “private school tuition organizations.” You get your entire donation credited in April on your state income taxes.
Don’t know a PSTO? The Arizona Department of Revenue lists some here. Don’t want to choose one in an uneducated manner? Give to Schools With Heart, 1131 E. Highland, Phoenix, AZ 85014, and designate your check for the Family School kindergarten program, which serves 62 children from diverse backgrounds.
Second is the separate-but-not-equal credit for public school contributions, up to $200 (individuals) or $250 (couples). You must give directly to the school; tax-deductible contributions to a PTO or foundation don’t qualify. The Arizona tax credit then refunds your entire donation.
Need a suggested school? The Arizona Department of Education has a school locator here. You can enter a name, city, or ZIP code and find contact information for both public and charter schools.
Need more instruction? Send your check to Kent Scribner at the Isaac School District, 3348 W. McDowell Road, Phoenix, AZ 85009. Over 90 percent of Isaac students are at or below poverty level; 62 percent don’t live in English-speaking homes. Last year, Isaac received approximately $3.17 in tax credit donations per student, compared to $34.49 for Mesa and $59.90 for Scottsdale. Unless you really do believe government’s sole purpose is to help the rich get richer, Isaac needs your help more.
Third, donations to charities helping the working poor qualify for another $200 tax credit (same amount for marrieds and singles). You must make an additional contribution to the qualifying charity over your “baseline” charitable giving. The baseline year is 1996, or the first year after 1996 in which you itemized or after your tax filing status changes. Donate more today, and Arizona repays you dollar-for-dollar.
Need assistance locating a “qualifying charity”? Here’s another list. Too much work in choosing one? Donate to Devereux Arizona’s “My Little Stocking” fund, which provides holiday treats to children in foster care and residential or group home treatment programs. These kids and their families can’t afford necessities, much less holiday gifts. Call Kelly Gonzales at (480) 998-2920 ext. 2105, or use the website.
The fourth widely-available credit helps fund Arizona’s system of publicly-financed elections. It’s the most “generous” of the credits; taxpayers can contribute $550 individually or $1,100 for a couple filing jointly, or 20% of their state tax liability, whichever is greater. Send your check to the Citizens Clean Election Fund at 1616 W. Adams, Suite 110, Phoenix, AZ 85007. You get a dollar-for-dollar Arizona credit, and contributions are also deductible for federal taxes; pay now, get it back in April.
Not only is this credit the biggest available, but it also drives supporters of the private school credit batty, because generally their credit benefits their friends but this one doesn’t. Consistency can be tough sometimes.
Finally, do something else which won’t cost you anything: Give blood. You probably thought about it after 9/11, but they didn’t need blood then -- and now we do, badly. It’s free, less painful (and quicker) than watching the Cardinals, and helps people more than money. Call United Blood Services at (602) 431-9500, or use their website.
You’ve got until December 31 to take advantage of bad law to do good deeds, so get cracking. Happy holidays!