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This quarterly newsletter provides recent updates and education information important to Arizona STOs.

Due Date Reminders

September 30th – FY 2015 Annual Reports are due for each credit for which your organization is certified. The signed engagement letter(s) for your audit or review and agreed-upon procedures engagement(s) should be attached to the report.
 
November 15th – Form 990, 990-EZ, or 990-N (e-postcard) is due to be filed with the IRS for fiscal years ending June 30, 2015.
 
December 31st – Audit or review and agreed-upon procedures reports are due to ADOR for FY 2015.

ADOR Clarifies Two New Laws Affecting STOs

ADOR provided two training sessions in June to discuss the administrative implementation of two new laws, HB 2153 and HB 2483, that affect most STOs. Some areas discussed during the meeting that were not included in the original outline are as follows:

HB 2153 (S-Corp Contributions)
  • Clarified that grantor trusts are allowed to take the pass-through credit if the trust is an S-corporation shareholder. 
  • Requested that STOs confirm corporate donations received within the 20 day approval period by email, not by phone. 
  • Clarified that the additional form ADOR will be sending S-corporations to provide shareholder information will not need to be administered by the STO and will not affect the eligibility of the donation.
  • The STO will not be required to report donations from S-corporations separately from those received from C-corporations on the Annual Report.
HB 2483 (Website Reporting)
  • Although ADOR will be requesting additional information on the Annual Reports regarding the number of scholarships awarded in each income level, the website disclosure appears to only require the amounts and percentage of amounts paid at each family income level.
  • Starting July 3, 2015, STOs should update their websites to report the required information for individual, switcher and low-income corporation programs for FY 2013/14.
  • When the FY 14/15 Annual Report is complete, the FY 14/15 information should be shown on the website.
  • Multiple years' reporting is allowed, but not required. 
  • Disabled/displaced applications are required to have family income information for FY 15/16 scholarships and therefore this data will be required to be reported on the website starting Fall 2016.

ADOR Releases Updated STO Manual

The Arizona Department of Revenue released an updated version of the STO Manual on June 5, 2015. The update includes the administrative requirements for complying with the two new STO laws passed. It also provides updated Annual Report templates with changes to the reporting of future scholarships awarded. Please ensure these updated Annual Reports are used when completing your FY 14/15 reporting. 

Tax Year 2016 STO Tax Credit Amounts Released

ADOR has released the individual tax credit amounts for tax year 2016. The combined 2016 maximum tax credit amounts of $2,173 Married Filing Joint and $1,087 Single are as follows:
Original Tax Credit:
$1,090 Married Filing Joint
$545 Single 
Switcher Tax Credit:
$1,083 Married Filing Joint
$542 Single 
The total corporate tax credit donation limitation for fiscal year 16/17 will be $61.917 million. The limit for all corporate disabled/displaced program tax credit contributions remains consistent at $5 million per year. 
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