Frequently Asked Questions For Working Poor Tax Credits
Q. What is the difference between a tax credit and a tax deduction?
A. A tax deduction helps determine how much taxes you owe to the state. A tax credit reduces the amount you owe to the state. By making a donation to a Qualifying Charitable Organization, you can reduce the amount you owe to the state or increase your refund, dollar for dollar. This allows you to donate to programs helping the working poor at no cost to you.
Q. How do I qualify for the Charitable Tax Contribution?
A. Starting in 2013, you DO NOT need to itemize your tax return to qualify for tax credits. As long as you have a tax liability to the State of Arizona, you qualify for tax credits. Just report the amount you donated to Chicanos Por La Causa, Inc. on Form 321. Up to $200 of this donation is eligible for a tax credit for individuals, or $400 if married and filing jointly.
Q. Is CPLC a qualified charitable organization under Arizona law?
A. Yes, CPLC is a Qualifying Charitable Organization as defined by the Arizona Department of Revenue and spends at least 50% of its budget on basic needs to residents of Arizona.
Q. How do I document my contribution?
A. CPLC will send you a letter confirming your contribution. This letter documents your contribution and is necessary to support your tax credit. Payroll deductions also require a pay stub receipt. Please make sure you include your name and home address on the donation page.
Q. How do I file for the credit?
A. Simply fill out Arizona Forms 321 and 301 and include them with your tax return. They are available online at the end of the year.
Q. Can I receive multiple tax credits?
A. Yes, you can receive a dollar-for-dollar tax credits for both the Charitable Contribution Tax Credit and the Arizona Public School Tax Credit.
Arizona Department of Revenue
Arizona Department of Revenue FAQ