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corporate tax credit

7 Steps To Taking The Corporate Tax Credit

With the deadline looming, did your company get the tax credit? Here are seven easy steps to taking the corporate tax credit.

Each year, companies that do business in Arizona are eligible to participate in the corporate tax credit program — it’s free to participate, as it’s simply a redirection of your state tax liability to a scholarship program. For doing so, your company can receive a dollar-for-dollar credit. This year’s deadline for credits for this year is looming; has your company taken advantage of the program yet?

The tax credit program has a statewide cap each year, and the fiscal year ends in June; so if your company plans to participate, time is of the essence.

Where does the money go?

Tax credit contributions given through Arizona School Choice Trust are used for scholarships for low-income students to attend private schools across Arizona. Your company can even designate the scholarships to certain schools or parts of town if there are places you do business. Scholarships can not be named for specific students. This program allows companies to invest back in their communities, improve education in Arizona, and do so at no cost.

Additional benefits

Your company can publicly announce your participation or remain anonymous. We have hosted many press conferences with check ceremonies promoting a company’s contribution.

These scholarships ensure children get a great education, are headed toward college, and dramatically improve outcomes for the future workforce.

Why ASCT?

Arizona School Choice Trust is the oldest and most experienced scholarship organization in Arizona. We take very seriously our dedication to helping families across the state whose children would not otherwise have the opportunity for a quality education. All of our families complete an extensive application process to ensure they demonstrate financial need. We allow parents to chose any private school in the state. Our scholarships are awarded on a first-come, first-serve basis. Each year we have thousands of applicants and, often, a long waiting list. Every corporate contribution goes a long way to awarding dozens of scholarships to students on our waiting list. We work closely with our corporate donors to share stories of the impact their donation has made, both with their internal leadership and publicly if they desire.

Here are the seven easy steps to participate in the corporate tax credit:

1.    Identify your company’s corporate tax liability.

2.    Determine how much you would like to donate versus pay to the state this fiscal year.  (Your company can donate the entire corporate tax liability amount.)

3.    Contact Arizona School Choice Trust, informing them of the amount you wish to donate. You can send a letter to ASCT’s office P.O. Box 1616, Glendale, AZ 85311; or contact us by email at ldrechman@asct.org. Include your company’s name, EIN #, amount you wish to donate and contact information.

4.    ASCT will file a one-page form with the Department of Revenue asking for approval for the donation/credit. We will send you a copy.

5.    The DOR will respond within 20 days on whether or not funds are available under the current fiscal year cap (for the 2010 fiscal year there is $20M available; 2011 is just over $22M).

6.    Within 10 days of DOR approval (DOR and ASCT will notify you), your company must send a check or wire to ASCT for the donation.

7.    When you file your company’s taxes, you will take the corporate income tax credit on the standard 120 form and file a 335 form as well listing the credit amount.

*Please consult your tax adviser for advice on filing and using your credit. This is only a guide; it does not constitute tax advice.

For more information, contact Elizabeth Dreckman at (480) 223-2769 or visit asct.org.

Arizona Tax Credit, ASCT

Is Your Business Taking Advantage of the Arizona Tax Credit Program?

Is Your Business Taking Advantage of the Arizona Tax Credit Program?

Did you know that Arizona businesses can redirect their entire state tax liability to scholarship organizations that help improve education in Arizona statewide?  If your business is not taking advantage of these credits, please read on.

The Program

The Arizona Tax Credit program allows any C-corporation that pays Arizona corporate income tax to redirect that liability to state approved school tuition organizations (STOs) that provide K-12 education scholarships for economically-disadvantaged children. It costs your business nothing; it’s simply a redirection of tax dollars your business must pay each year. Corporate tax dollars can be given to STOs to fund scholarships for low-income children or designated specifically for scholarships for displaced and disabled students.

Corporations receive a dollar-for-dollar tax credit with the state, therefore allowing corporations to redirect funds that they must already pay to the state of Arizona to the STO at absolutely no cost.

The process to enroll is very simple, and the Arizona School Choice Trust (ASCT) can handle all the paperwork for your corporation. Read more information about the program on ASCT’s website asct.org.

How do these dollars help?

Every single scholarship ASCT gives out changes the course of a student’s life forever and gives a child a chance at graduating, going on to college and becoming a productive member of Arizona’s workforce and business community.

Here’s one example of ASCT’s success stories: Jorge has been on scholarship from ASCT for nearly a decade and is now a senior at Glendale Christian Academy. He says the school has transformed his life and plans to go on to college to pursue a BS in business management with a minor in music and one day open his own business.

How can your business participate?

The process is simple. To take advantage of this tax credit, a corporation contacts ASCT and pledges to make a contribution of $X amount (any amount up to the company’s state tax liability for the year).

ASCT then completes a one-page application for that amount and submits it to the Arizona Department of Revenue (ADOR) for the corporation. If the tax credit cap (more than $24 million this fiscal year) has not been met, the ADOR approves the request within 20 days. The corporation has 10 days from the date of approval by the ADOR to make the contribution. The corporation takes the tax credit on its tax return, but may carry any unused credit forward for up to five years. The corporation may take either the federal deduction or the Arizona state credit, but not both. To claim the credit, the corporation lists the credit on the standard 120 form and files a 335 form attached to the return.

Arizona School Choice Trust mission is to provide hope and opportunity to low-income families by providing tuition scholarships to enable their children to attend private elementary and secondary schools (K-12). We believe that a solid primary education is the key to giving children the opportunity to succeed in life and achieve their dreams, and it is key to providing Arizona a strong, educated workforce.

ASCT is the oldest and most experienced STO. ASCT focuses its scholarships on low-income students who qualify for the National School Lunch Program.  Since 1993, it has  provided more than 10,000 scholarships.

Visit asct.org to find out more about how your business can take advantage of these tax credits and change the lives of students across the state.