Notice: A school tuition organization cannot award, restrict or reserve scholarships solely on the basis of a donor recommendation. A taxpayer may not claim a tax credit if the taxpayer agrees to swap donations with another taxpayer to benefit either taxpayer's own dependent.

Donor Help Center

Understanding a Credit

A tax credit is a dollar-for-dollar reduction of the income tax you owe. For example, if you owe $1,000 in federal taxes but are eligible for a $1,000 tax credit, your net liability drops to zero.  Essentially, a tax credit offsets the amount of taxes you owe. Unlike tax deductions and exemptions, which reduce the amount of your taxable income, tax credits reduce the amount of taxes you owe.

  • To better help you understand the difference between a Credit and a Deduction, here are some helpful points:
    • A Credit reduces taxes owed dollar-for-dollar while a deduction reduces taxable income. Taxable income is used to determine the taxes owed. In effect, the benefit of a deduction depends on the tax bracket of the donor. The benefit of a Deduction ranges from 0% to 5% of the donation. The benefit of a Credit is 100%.
  • How do I know if I am paying Arizona Taxes?
    • Look at your "Balance of tax" on line 35 of Arizona Tax Form 140. If that number is greater than 0, you pay Arizona Income Tax.
  • What does Arizona Tax Liability mean?
    • Simply put, if you pay income taxes to Arizona, you have an Arizona Tax Liability.
  • Download the full brochure.

Employee Withholding

  • An employee can request that his or her employer reduce his or her withholding in an amount equal to income tax credit(s) the employee will qualify for when filing the employee's income tax return.        
  • For employers who have withheld a charitable portion of their employee(s) paycheck(s) to be paid to STAY or School Tuition Association of Yuma, you will need to fill out and send form A1-QTC .

Notice: A school tuition organization cannot award, restrict or reserve scholarships solely on the basis of a donor recommendation. A taxpayer may not claim a tax credit if the taxpayer agrees to swap donations with another taxpayer to benefit either taxpayer's own dependent.

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