In other words, Sun City CAN helps people save money on things like property taxes, income taxes, utilities, Medicare premiums, prescription drugs and other things.
Many benefits go unclaimed simply because people are unaware that the benefits exist. In an effort to shed light on some of the help that is available to low-income seniors, I will write a guest commentary each month about a different senior help program.
Below is a listing of benefits available for low-income seniors that some may not realize are available.
State program
If you don’t understand Arizona tax credits and qualifying charitable organizations, that’s okay, you are not alone.
Many, if not most, Arizona taxpayers are unaware that you can combine multiple tax credits and carry forward benefits for multiple years to come. These credits permit taxpayers to give money to a worthy charity or school instead of paying the money to the state of Arizona in the form of income taxes.
Charitable tax credit
In short, a qualified charitable organization is a 501(c)(3) nonprofit organization that promises to spend its budget on qualified services to help the community and has been approved by the state of Arizona for the Arizona charitable tax credit.
To receive the dollar-for-dollar Arizona charitable tax credit, you only need to remember these four steps:
Donate to a QCO. Here are three local charities that are approved QCOs: Sun City Community Assistance Network, Valley View Community Food Bank and Northwest Valley Connect. A complete list of qualifying charities can be found on the Arizona Department of Revenue website.
Keep the receipt for your gift to the charity.
Complete Arizona Form 321 during tax preparation.
Subtract your dollar-for-dollar credit from your tax liability when calculating you individual tax return. The maximum credit allowed is $800 for married couples and $400 for single individuals. Example: If a single taxpayer owes $400 in Arizona state taxes and donates $400 to a QCO, his or her tax liability is reduced to $0.
Other tax credits
Qualifying Foster Care Organizations. This is a dollar-for-dollar income tax credit for donations that provide basic needs to individuals in the foster care system.
A list of qualifying charities can be found on the on the Arizona Department of Revenue website, az.dor.gov. Maximum credit allowed is $1,000 for married and $500 for single. Use Form 352 to claim this credit.
Public Schools. You can make a contribution directly to a public school in the state of Arizona for the support of eligible activities and receive a dollar-for-dollar state income tax credit.
Maximum credit allowed is $400 for married and $200 for single. Claim the credit on Form 322.
Private School Tuition Organizations. This fund provides scholarship or grants to students who attend nongovernmental primary or secondary schools located in Arizona.
Also included are preschools that offer services to students with disabilities. A list of qualifying charities can be found on the on the Arizona Department of Revenue website. The maximum individual credit is $611 for single taxpayers and $1,221 for taxpayers filing a joint return. Claim this credit on Form 323.
Summary
People who owe Arizona state income taxes can take advantage of not just one of the above credits but all of the above credits.
For example, a married couple could donate to a public school, a private school, an approved charity and an approved foster care charity. They can then subtract the total amount from their Arizona state tax liability. Any unused amount can be carried over to the next year. More importantly, their donations will have helped nonprofit organizations and school children.
You can contribute to all of the above until April 15 of the following year. All tax credits are “non-refundable,” which means they can only be used to offset taxes owed, not to increase a state income tax refund. For more information about the these tax credits, consult the Arizona Department of Revenue website.
Editor’s Note: Hugh Duncan is a retired Episcopal priest, a former nuclear engineer and a U.S. Navy retiree.
