Tuition Tax Credit Law
Individual Tuition Tax Credits
The Arizona Private School Tuition Tax Credit Law A.R.S. 43-1089 permits you to redirect your state tax liabilities to School Tuition Organization 4 Kidz (STO4KIDZ) to create financial aid for K-12 students, and receive a dollar-for-dollar tax credit, all at NO Net Cost.
For financial aid eligibility and for tax filing purposes the contribution is categorize into two program:
Corporate Tuition Tax Credits
In 2006 and then in 2008, the Arizona State Legislature passed into law “The Corporate Income Tax Credit” and then the Disabled/Displaced Corporate Income Tax Credit, allowing businesses with an Arizona tax liability to allocate up to 100% of their tax liability and make a contribution to a qualified School Tuition Organization such as STO4KIDZ, and receive a dollar-for-dollar Tax Credit, may also qualify to claim that amount on their federal taxes as a donation.
Please visit our Corporate Tax Credit “Fact-Sheet” for an overview of this program, and “select HERE ” to submit your corporate tax credit application.
Sto Certification, Compliance, and Requirements
STO4KIDZ is a certified non-profit 501(c)(3) School Tuition Organization (STO) authorized by the Arizona Department of Revenue to manage Private School Tuition Tax Credit Programs.
A.R.S. 43-1602 and 43-1603 mandate STOs to be certified by the Arizona Department of Revenue (ADOR) to handle tax credit donations for granting tuition scholarships.
Eligibility requirements for an STO to receive and maintain certification. The STO:
- must allocate at least 90% of its annual contributions to scholarships;
- shall not limit the availability of scholarships to students of one school;
- must allow ADOR to verify that the scholarships issued are awarded to students attending a qualified school (Corporate income tax credit program);
- must not knowingly collude with any other STO to circumvent the limits of the low-income corporate scholarship (Corporate income tax credit program);
- may allow donors to recommend student beneficiaries but shall not award, designate or reserve scholarships solely on the basis of donor recommendations (Individual income tax credit programs);
- shall not allow donors to designate student beneficiaries as a condition of any contribution to the organization (Individual income tax credit programs);
- shall not facilitate, encourage, or knowingly permit the exchange of student beneficiary designations (i.e. swapping) (Individual income tax credit programs);
- shall include on the organization’s website, if one exists, the percentage and total dollar amount of educational scholarships and tuition grants awarded during the previous fiscal year to (a) students whose family income is up to 185% of poverty level and (b) students whose family income is greater than 185% of poverty level but not more than 342.25% of poverty level;
- must not award scholarships to students who are simultaneously enrolled in a district school or charter school and a qualified school; and
- shall follow all other statutory requirements in A.R.S. §§ 43-1089, 43-1089.03, 43-1089.04 or Title 43, Chapter 16; and
- shall follow all other statutory requirements in A.R.S. §§ 43-1183, 43-1184 or Title 43, Chapter 15.
Arizona Department Of Revenue Guides
The Arizona School Choice
Click on the links below for valuable information on the school choice available in the state of Arizona including private schools and the tax credits supporting them.
If you have questions, please call us direct at 602.698.8855 or email Info@sto4kidz.org