What are Tax Credits?

Arizona income tax credits are state-authorized reductions in your Arizona income tax liability (taxes owed), designed by policy to encourage charitable giving, education support, military family relief, renewable energy investment, and more. Unlike itemized deductions, tax credits directly reduce the amount of tax you owe, dollar-for-dollar. All types of tax credits can all be used in combination in a single tax year.

What are QCOs and QFCOs?

Arizona QCOs and QFCOs are two categories of nonprofit organizations certified by the Arizona Department of Revenue (ADOR) to receive tax credit contribution donations from income taxpayers.

Any financial contribution up to the allowable limit qualifies for tax credits, there is no minimum requirement.

A searchable online list of QCOs and QFCOs with charity descriptions can be viewed here or click below, or a PDF list of names and addresses can be downloaded here.

How many Arizona taxpayers use these charity contribution tax credits?

Over the currently available recent reporting years, about 3.5M income tax returns are filed each year in Arizona.

Of those returns, about 185,000 taxpayers claimed the QCO charity tax credit (about 5%). Only 40,000 claimed the QFCO tax credit on their returns (about 1%). Source: ADOR annual reports - see table 30

How do you claim/use these charity tax credits?

Donate to qualified charities, keep a receipt of record, note the five-digit charity code, and claim your charity tax credits using Form 321 (QCO) or Form 352 (QFCO) with your Arizona income tax return. Always consult your tax preparer for all tax advice.

Why should you use these tax credits?

This is a rare chance to align your tax dollars with your values—whether that’s youth services, housing, healthcare, or education. Arizona is one of the few states that provide tax credits for charitable contributions.

• Support low-income families, children in foster care, people with disabilities or chronic illness, homeless individuals and domestic violence survivors; these organizations often operate more efficiently than government programs and are deeply embedded in Arizona communities.
• Donate up to April 15 and still apply the credit to the previous tax year.
• You don’t need to itemize your deductions—any taxpayer can claim these credits.
• If your donation exceeds your tax liability, the unused portion can be carried forward for up to five years, you never lose the benefit.
• It's the best feel wonderful deal in Arizona!