Session to show how tax credits can aid schools

Library to host event on deductions, etc., Dec. 30

Taxpayers wanting to help local schools and looking to save on their state and federal tax bills before 2017 ends have several options.

Andrew Zollman, the business librarian at the Yuma Main Library, will hold an information session on the topic of saving money with deductions and credits from 1 to 2:30 p.m. Dec. 30 at the Main Library’s Meeting Room B.

The session will target tax situations for both individual and families, and cover several types of credits and deductions.

The session is not intended as tax or financial advice, and participants should have a good understanding of their current financial status before attending, the library stated on its calendar about the event.

Taxpayers may save on their Arizona taxes by donating directly to public schools and to private schools through private school tuition organizations within the state. Donations can be made up until April 17, 2018, for either the 2017 or 2018 tax year, according to the Arizona Department of Revenue publication 707, which was updated in November. (April 15 falls on a Sunday in 2018, and Monday, April 16, is a holiday in Washington, D.C.)

For public schools, Arizona allows taxpayers to support extra-curricular activities with a tax credit of up to $400 for joint filers, or $200 for single filers. The credit only reduces the amount of tax a filer owes the state of Arizona, i.e., if there is no tax liability, then the credit may not be taken, according to Publication 707. However, the amount exceeding the credit may be rolled forward for not more than five consecutive years.

Funds from tax credits support programs such as sports, band fees, lab sciences, art projects and field trips, according to both the Crane and Yuma District One websites. Those claiming the credit need not have children within the district to qualify.

Arizona also allows donations from individuals and families to private school tuition organizations, often called STOs. There are two STOs in Yuma County, though there are several statewide STOs that support students here, the School Tuition Association of Yuma, Inc. (STAY) and Yuma’s Education Scholarship Fund for Kids.

Arizona STOs are charitable organizations that are exempt from federal taxation under section 501(c)(3) of the Internal Revenue Code. Any STO must allocate at least 90 percent of its annual revenues for educational scholarships or tuition grants to children to allow them to attend any qualified private school of the parents’ choice, said Rex Pope, the STAY program administrator, in a news release.

STOs may not limit tuition scholarships or grants to only students of a one school, and by law, donations cannot be made directly to the school if the credit is to be taken, Pope said.

Married couples filing a joint return may take a credit of $2,177 for 2017, and individual filers may take a credit of up to $1,089.

Because STOs operate as 501(c)(3), contributions to them may also be taken as an itemized deduction on the federal tax return for 2017.

The federal deduction for any donation can only be taken in the year in which it was given.

For more information about the library information session, contact Zollman at (928) 373-6480 or andrew. zollman@yumalibrary.org. For information from schools, contact the front office. Many schools and district offices are closed for winter break, and will not open until after the new year begins.