House of Representatives

HB 2465

charitable organization; tax credit

Sponsors: Representatives Anderson, Cooley: Dunbar, et al

 

DPA/se

Committee on Ways and Means

 

Caucus and COW

 

 

As Passed the House

 

HB 2465 increases the charitable organization personal income tax credit to $500 and expands the credit to allow corporations to also qualify.

 

History

Laws 1997, Chapter 300 (Welfare Reform) created a personal income tax credit of $200 for charitable cash donations made to charitable organizations that spend at least 50 per cent of their budget on services to Arizona residents who receive TANF or have low-incomes (defined as 150% FPL).  The credit was allowed for only contributions that exceeded a prior year’s baseline contribution.

 

HB 2465 eliminates the requirement that the donation must exceed a baseline year’s contribution and increases the credit amount from two to five hundred dollars.  In addition, HB 2465 extends the credits to corporations that make donations to qualifying organizations.

 

Provisions

·                      Increases the TANF personal income tax credit from $200 to $500 and creates a similar corporate income tax of $500.

·                      Eliminates the personal income tax credit requirement that the credit only applies to donations that exceeded a prior year’s baseline charitable contribution.

·                      Clarified co-owners of a business or partnership may only take a pro rata share of the credit allowed based on ownership interest.

·                      Provides a delayed effective date for taxable years beginning from and after December 31, 2000.

Ways and Means Committee Amendment

The Ways and Means Committee adopted a same subject strike-everything amendment to the bill with the following provisions.

·                   Provides that taxpayers who do not itemize deductions may be eligible to take the charitable organization personal income tax credit enacted in the 1997 Welfare Reform Act.  Currently, the tax credit is available only to those taxpayers that itemize deductions.

 

·                   Provides an effective date for tax years beginning after December 31, 2000.

 

 

 

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44th Legislature                                                                                               Analyst Initials _______

Second Regular Session                                                                                             February 8, 2000

 

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