WHAT IS A QUALIFIED CHARITABLE ORGANIZATION (QCO)?

Qualifying Charitable Organizations (QCOs) and Qualifying Foster Care Charitable Organizations (QFCOs) are certified by the Arizona Department of Revenue to receive contributions eligible for the tax credit. This certification only pertains to the Arizona tax credit program. To become a QCO or QFCO, a charitable organization must serve Arizona residents who receive temporary assistance for needy families (TANF) benefits, are low income residents whose household income is less than 150 percent of the federal poverty level, or are chronically ill or physically disabled individuals. QCO’s must also spend at least 50% of its budget on qualified services to qualified Arizona residents.

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WHAT IS THE AZ TAX CREDIT PROGRAM?

Arizona provides two separate tax credits for individuals who make contributions to charitable organizations: one for donations to Qualifying Charitable Organizations (QCO) and the second for donations to Qualifying Foster Care Charitable Organizations (QFCO). Individuals making cash donations made to these charities may claim these tax credits on their Arizona Personal Income Tax returns. These tax credits provide dollar-for-dollar tax benefits, allowing taxpayers to reduce their state tax liabilities for each dollar donated to charities, up to the maximum allowable limits.