“It felt too good to be true,” says Jennie Duvernay, a Phoenix librarian. “I mean, I’d just given the donation in December and there it was on my tax return. All $200.”
Duvernay participated in Arizona’s Charitable Tax Credit Law (ARS43-108) in 2013 after hearing about the program through a friend’s post on social media.
“I felt a little guilty that it was so easy. It was just a temporary loan to the organization,” she says. Duvernay, who has 14 nieces and nephews, researched school districts in poorer neighborhoods of Phoenix to benefit from her donation.
The state’s tax credit allows individuals to give up to $200 to qualifying organizations annually. The donation, as of 2013, no longer needs to be itemized. Additionally, the donation counts toward federal taxes— although not as a credit. Married couples can give up to $400 per organization. When filing single or married there is a cap of donating to three qualifying organizations (listed here) per year to receive the full tax credit on your state taxes.
This system is a no-brainer for those who want to help the community.
“I gave $200 to the school district, and got $200 back a bit later,” Duvernay describes. “This year I need to find other organizations to support too. This system is a no-brainer for those who want to help the community.”
Her one complaint about the process? When researching the school districts, the wealthier districts appeared at the top of Internet searches. The poorer districts often didn’t have the ability to accept an online donation. This angered Duvernay.
“That made me cringe,” she says. “I felt like the rich could easily get richer. I wanted to help the kids who needed it most.” After contacting the school she wanted to support, she ended up sending a check.
According to officials at the Arizona Department of Revenue, “a Qualifying Charitable Organization is a charity that is a 501(c)(3) or a community action agency that receives community services block grant program monies that spends at least 50 percent of its budget on services to Arizona residents who either 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 children and shows that the charity plans to continue spending at least 50 percent of its budget on services to those described above. A charity has to apply for and meet all requirements of the law to be considered as a Qualifying Charitable Organization. Approved charities’ names are listed on the Department of Revenue’s website.”
There are several hundred qualifying agencies, meeting the educational, health, and social well-being needs of Arizona’s poor. One such agency is Phoenix-based Circle the City. The organization’s mission is, “Everyone deserves a time and place to heal.”
Circle the City was founded by Sister Adele O’Sullivan, CSJ, MD—a physician and nun—to meet the medical needs of Phoenix’s homeless population. The organization provides medical respite care for up to 50 people at a time.
Betsy Ganz, the Development Director at Circle the City, says the tax credit contribution is critical to their organization’s ability to meet the ongoing medical concerns of Phoenix’s most needy homeless population.
“Arizona’s Charitable Tax Credit is the backbone of our individual giving program for charity care,” she says. “For example, a $200 donation enables us to provide up to two months of medication for one of our patients, two months of physical therapy for a patient who needs it, or a healthy dinner for everyone admitted to the program on a given day.”
In 2012, legislative changes resulted in the addition of some foster care organizations to the tax credit program, as well as eliminated the need to itemize tax credit contributions. Since that time Circle the City’s donations have increased.
Tax credit donations make it possible for Circle the City to be there for the homeless during their time of need.
“In 2013, tax credit contributions increased approximately 30 percent from 2012,” she says. “This year, more and more homeless adults are finding themselves ill or injured while on the streets or in the emergency shelter system. Tax credit donations make it possible for Circle the City to be there for them during their time of need.”
Ganz says their organization is focusing on social media, direct mail, and volunteer efforts to get the word out about the credit.
“We utilize mailers, our website, monthly electronic newsletters to employees, donors, and volunteers as well as e-blasts, social media platforms, employee town halls, volunteer orientations, and board engagements,” she describes.
“I didn’t know how many organizations qualified,” said Duvernay, a Circle the City donor. “I’d give to Circle the City regardless, but the credit is a nice benefit.”
The tax credit provides a new method for nonprofits to connect with those who may not otherwise know about their work.
Alicia Sutton Campbell, the Executive Director of qualifying organization Free Arts of Arizona, says one of the understated benefits of the tax credit is providing a new method for nonprofits to connect with those who may not otherwise know about their work.
“We have art exhibits and use these to showcase the tax credits too,” she explains. “We can show who we are and how folks can help without them having to attend an orientation or a luncheon.”
Free Arts of Arizona’s mission is, “Healing abused and homeless children through artistic expression.”
Campbell says the art is the mechanism to help children who have suffered from trauma to reach recovery.
“The work we do, art is the tool we use, but it is not the outcome we are striving for,” she says. “We are not there to teach kids to be ballerinas or graphic designers, but to utilize art to help them heal. Our outcomes are about building self-esteem and trusting relationships with adults, and to build coping skills.”
She says the tax credit has allowed the organization to expand to serving 7000 children in the Phoenix metro area with a staff of just 12.
“We work with 500 volunteers who deliver our programs,” Campbell says. “That is how we are able to serve so many kids. We greatly benefit from this tax credit, although I think one of the most confusing aspects about this credits is people don’t understand that they can give to a school and to a qualifying charitable org.”
Current Free Arts of Arizona exhibits may be found at Whole Foods Market on Camelback in Phoenix, and within the education wing of the Phoenix Art Museum.
Header photo by Lisa Olsen
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