Brenda Blunt, a partner with Eide Bailly LLP, said one change this year is a new program from the Arizona Department of Education called the Empowerment Scholarship Account program, or “ESA” funding. “Families can apply for funding under this program to pay for private school tuition and other education expenses up to certain limits,” she said. “We have received calls from clients expressing confusion about the new program. It is important to know that the program does not allow families to receive both ESA funds and STO funds, but families receiving ESA funds can still contribute to STOs and qualify for the credit.” It’s true — you can give to a qualified charity or tuition organization instead of giving it to the state government for taxes. And over time, these contributions have become increasingly popular for residents and beneficial for nonprofits. “Some people hesitate to donate to these programs because they are not sure what their Arizona tax liability will be for 2022 and because the combined tax credits cannot exceed any given taxpayer’s Arizona tax liability for the current year,” Blunt said. “It is important to know that contributions paid within the credit thresholds this year, but your Arizona tax liability can carry forward for five years, so are not lost. They can benefit future years. Contributions paid over the thresholds are not eligible for the credit, but can be taken as a charitable contribution deduction, so it is still a tax benefit.” It is worth noting that recent changes in the tax law allow limited deductions for charitable contributions at the federal and Arizona levels, even when a taxpayer takes the standard deduction. “So there are lots of ways to use these programs to help vulnerable Arizona families and still help yourself come tax time,” Blunt said. “These contributions have become increasingly popular for residents and beneficial for nonprofits.” Photo courtesy of The Center for the Rights of Abused Children Photo courtesy of The ALS Association–Arizona Chapter 12 FRONTDOORS MEDIA | TAX CREDIT GIVING GUIDE

Gerald Wissink, president & CEO of BHHS Legacy Foundation, said tax credit contributions have a tremendous impact on specific programs, including ones his foundation supports. “Tax credit contributions help us support Legacy Connection’s Backpack Buddies program,” he said. “This program provides back-to-school supplies and clothing that Title I children need when they go to school, enhancing their confidence and ability to focus on education. One in four students in this state lives in poverty. Thanks to tax credit donations, we can make a powerful difference in their lives.” Nancy Padberg, president & CEO of Catholic Education Arizona, said that STO contributions have a huge effect on thousands of Arizona children. “Choosing the education model that best meets For a complete list of qualifying charitable organizations and qualifying foster care organizations, see azdor.gov/tax-credits/contributions-qcos-and-qfcos . Organizations are added on an ongoing basis, so it may be worth your time to check back before year-end and again before April 18, 2023 — the last day 2022 tax credit contributions can be made. a child’s needs should not depend on one’s ability to pay tuition,” she said. “The State of Arizona allows taxpayers to support private education through their individual tax credits, allowing them to change lives, serve society and transform culture.” Wissink said these contributions are an important way for Arizonans to support their favorite charitable causes, whether during difficult times or smooth sailing. “This is a chance for our community to invest in Arizona’s future,” Wissink said. “Thanks to the Arizona Charitable Tax Credit, you can decrease your Arizona tax bill — or increase your refund — by $400 or $800. That means your gift ends up costing you nothing. It is a simple but powerful way to reach out and impact our community.” TAX CREDIT GIVING GUIDE | FRONTDOORS MEDIA 13 “Thanks to the Arizona Charitable Tax Credit, you can decrease your Arizona tax bill — or increase your refund — by $400 or $800 It is a simple but powerful way to reach out and impact our community” Photo courtesy of Brophy College Preparatory