While many businesses dread any work that has to do with taxes, the Low Income and Disabled/Displaced Corporate Tuition Tax Credits give them an opportunity to positively impact the education of Arizona’s underserved children. Catholic Education Arizona (CEA) is one of the certified School Tuition Organizations (STO’s) by the Arizona Department of Revenue that corporations can direct their state tax liability to. In fact, approximately 50% of CEA’s contributions come from corporations that operate in Arizona. Read on to discover how you can partner with CEA and maximize your Arizona state tax liability.
Who Can Become a Corporate Partner?
The Corporate Tax Credits have allowed Arizona S & C Corporations, Insurance Companies that pay Premium Tax and LLC/PLLC’s that file as S or C Corps the chance to invest in the education of Arizona’s children since 2006. While CEA distributes the funds that come from the tax credit to 38 Catholic schools within the Diocese of Phoenix, the students come from all areas and backgrounds.
Approximately 30% of high school students are non-Catholic. By partnering with CEA, you can help Arizona’s children receive a high-quality education and become part of the 99.4% of Catholic school students who graduate high school and the 97% that advance to higher education or enter military service.
Eligible businesses may direct 100% of their state tax liability to CEA on behalf of our schools. If you’re unsure as to whether your corporation is eligible, check with your CPA as to your tax filing status. You may also need your CPA to identify your corporate income tax liability or insurance premium tax will be owed to the state of Arizona. This will determine how much you can direct to CEA. No risk, if you direct too much, you may carry the credit over for up to 5 years!
Apply by June 30, 2021
Once you determine whether your corporation qualifies and how much liability you can direct to CEA, simply complete the Corporate Tax Credit Commitment Form and submit it to CEA. Make sure to get your commitment form in by June 30, 2021. CEA will submit all applications to the Arizona Department of Revenue when the tax credit opens on July 1, 2021.
You can download the Corporate Commitment Form, which can be found here, and submit it via email or mail. In addition to providing basic information about your corporation, the form also allows you to designate the schools which you’d like your contribution to go. You can also choose the General Scholarship Fund, which benefits the schools with highest unmet financial need.
The Arizona Department of Revenue will accept the corporate tax credit applications from CEA and other qualifying organizations starting on July 1, 2021 until the statewide caps are met. CEA will notify each corporation when their tax credit application has been approved, typically within 10 business days of the application submission. Upon approval from the ADOR, your corporation has 20 calendar days to pay CEA for your tax credit contribution. At the time of filing, list the credit on the standard 120 form and file a 335 form attached to the return.
To invest in education, and maximize your state tax liability, download the CEA Corporate Tax Credit Commitment Form today and submit it by June 30, 2021. If you have any questions, please contact CEA today.
Catholic Education Arizona is an IRS 501(c)(3) nonprofit charitable organization and has never accepted gifts designated for individuals. Per state law, a school tuition organization cannot award, restrict or reserve scholarships solely on the basis of donor recommendation. A taxpayer may not claim a tax credit if the taxpayer agrees to swap donations with another taxpayer to benefit either taxpayer’s own dependent.
