Corporations have one more week to submit applications to receive a dollar-for-dollar tax credit for helping provide scholarships for students in Jewish day schools.
C-corporations, S-corporations, insurance companies and LLCs filing as S-corporations are eligible to take the corporate Arizona private school tuition tax credit when they support student tuition organizations for students attending private schools. The Jewish Tuition Organization is an STO that provides scholarships to six local Jewish day schools.
The application deadline is Thursday, June 27.
The corporate tax credits are “very important because we can get larger amounts, up to the $106 million cap, and it all goes to needs-based awards for low-income students,” said Linda Zell, JTO executive director. “Our goal is to fill every seat in every school and allow every child whose family wants them to attend a Jewish day school to be able to attend.”
The JTO, along with other STOs in the state, will submit the applications to the Arizona Department of Revenue on July 1. Once the $106 million cap on corporate tax credits is reached, no more will be accepted. Last year, the state’s cap was reached in the first two minutes of the application process, said Zell. The JTO applied for just under $2.3 million from 63 corporations and received approval on $1.7 million for 51 corporations before the cap was reached.
“They have improved the application process this year so that we can prioritize the applications that receive approval,” Zell said. She notes that the JTO will “make it as simple as possible” for corporations to apply; the corporation only needs to fill out one form “and we do everything else.”
There isn’t a maximum amount for the credit (besides the $106 million statewide cap on the program), but S corps have a minimum donation of $5,000. It is recommended for all to check with their tax preparer regarding their tax benefits.
For the first time, the JTO will allow corporations to specify whether they want their funds to go to the JTO’s general fund, to a specific school fund or multiple school funds. By law, no corporate funds can be recommended for a specific student and all funds are used for needs-based awards to low-income families.
Individual donors can also now recommend where they want their funds to go. They have a choice of recommending their funds go to the JTO’s general fund, to a specific school fund or to an individual student, as long as that student is not the taxpayer’s child or dependent. The students do not have to be eligible for a need-based award in order to receive a recommended scholarship.
Taxpayers can donate at any time during the year, and monthly payments can be arranged. Taxpayers filing individually can donate up to $1,135 and married couples can donate up to $2,269.
In total, the JTO received $4.6 million for the 2018 tax year and those funds will be allocated in scholarships for the 2019-2020 school year, Zell said. For the 2018-2019 school year, the JTO provided nearly $3.89 million in scholarships for about 600 students in grades K-12.
Zell explained that Arizona law requires school tuition organizations to grant at least 90% of the contributions they receive, but the JTO typically grants about 94%, “because our goal is to give away as much as possible and we run a very tight ship.”
The JTO provides scholarships to students attending Pardes Jewish Day School, Torah Day School of Phoenix, Phoenix Hebrew Academy, Shearim Torah High School, Desert Jewish Academy and Yeshiva High School of Arizona. JN
To apply or donate, visit jtophoenix.org or call the JTO, 480-634-4926.