At Redeemer, most of our tuition scholarships are awarded through the AZ Tuition Tax Credit for Private Schools. We encourage our school families to attend informative Parent Workshops held throughout the school year, to use the tax credit themselves on their own personal AZ tax returns, to get as many family, friends and co-workers to use the tax credit and recommend their student(s), and to apply for as many scholarship applications as possible every year to help supplement their tuition liability.
What is the Arizona Tuition Tax Credit for Private Schools?
When an Arizona taxpayer makes a donation to a scholarship tuition organization (STO), they receive a dollar-for-dollar credit against their state tax liability. This means that at the end of the year, if they would normally get a refund, they'll get a bigger refund. If they normally owe taxes, they'll owe less.
In turn, Arizona scholarship organizations use these tax credit donations to award tuition scholarships for K-12 students attending one of our Partner Schools, of which Redeemer is one.
In addition, when a taxpayer makes a donation to an STO, they can identify a school and even recommend a student to receive a scholarship. (By Arizona law, a recommendation does not guarantee a scholarship.) When the STO's selection committees make their award decisions, they do consider these recommendations, in addition to financial circumstances, and the narrative in the student’s application.
As a parent applicant, in order to be considered for a scholarship, every STO needs a current scholarship application for each of your children. In addition, your children must either be enrolled or in the enrollment process at the school listed on the application. You will find links to many STO's from which Redeemer students have received awards at the bottom of the page. Parents, apply to as many as you can every year!
As a donor, you can donate your individual tax liability and also as a small business owner. The two programs are:
Individual tax credit program
· Any AZ taxpayer can donate.
· Donations can be awarded based on need and other factors.
· Donations can be recommended for a specific student.
Original tax credit
· Any AZ taxpayer can donate (by April 15).
· Anyone eligible to receive.
Overflow (plus or switcher) tax credit
· Any AZ taxpayer can donate (by April 15).
· Anyone eligible to receive must be ONE of the following.
1) Students who switched from a public/charter school to a private school in the previous school year after having attended the public school for at least 90 days (or one full semester) before switching OR
2) Students enrolled in Kindergarten OR
3) Pre-K students with a disability (attending a private school that offers specific services for that disability) OR
4) Students who are dependents of a member of the US Armed Forces who is stationed in Arizona pursuant to military orders OR
5) Students who have already received a scholarship through the PLUS program or through the Corporate Tax Credit Program in a prior year and continue in private school since receiving the award.
Corporate tax credit program
· AZ corporations can donate (a cap for the corporate donations exists).
· Donations can be recommended for a school.
· Donations cannot be recommended for a specific student.
· During 2017-18 the Corporate award limit per student per STO will be $6600 for high school/$5300 for Prek-8.
· Lexie’s Law - Displaced/Disabled
· Scholarships are for eligible students who
1) are either:
A. Entering Kindergarten at a qualified private school OR
B. Transferring from a public/charter school having attended 90 days or 1 full
semester of the previous school year or current year OR
C. Disabled Preschooler with a Public school IEP OR
D. Dependent of active duty military stationed in Arizona on orders OR
E. Received a Corporate or Individual award in a prior school year AND
2) Meet the state mandated income cap. Each year the figures are updated in the spring for the following year.
school tuition organization (sto)
· An STO serves as “clearing house” that accepts taxpayer donations and distributes funds to schools
· Funds distributed = “awarded a scholarship”
· Scholarships can be based on need and other factors
· Scholarships can be recommended – an endorsement for the student
· Each STO has its own procedures/applications/due dates/award periods
· All applications are submitted once a year and remain valid for that current school year
· Students can receive multiple scholarship awards from more than one STO.
1. The state prohibits recommending tax dollars for taxpayers’ own dependents.
2. The law also does not tolerate purposeful recommendation “swapping” between taxpayers.
3. A school tuition organization cannot award, restrict, or reserve scholarships solely on the basis of a donor's recommendation.
a. A student recommendation serves only as an endorsement for that child, vouching he or she is worthy of the award.
b. ACSTO considers it a privilege to take your recommendations into consideration. When you make a recommendation, you are vouching for that child. Consider it as an endorsement for him or her as a worthy recipient of a scholarship award.
c. There are no guarantees that the student named on the recommendation will receive an award because the tax credit program was not designed to guarantee anything to anyone.
d. Demanding a designation as a condition of a donation is not a charitable act; it disqualifies any sort of credit or deduction the taxpayer would want to claim. It would also jeopardize the 501(C)(3) status of the charitable organization since no goods or services can be promised in return for a charitable gift.
e. The typical procedure followed when applying for a scholarship is to submit an application, then wait to see if you are able to receive an award or not: this is no exception.
sto's to utilize
· The list below contains STOs that have been utilized at Redeemer in the past, but is, by no means, a complete list of Arizona Scholarship Tuition Organizations. We encourage parents to apply to as many as possible.
· Anyone can donate their tax dollars to any STO but we strongly encourage donors to use ACSTO.
· You can apply to receive scholarship awards from any STO.
· More STOs exist for you to research on your own.
1. ACSTO – Arizona Christian School Tuition Organization [AZ WELS Schools partner] - (acsto.org) ACCEPTS APPLICATIONS ANYTIME THROUGHOUT THE YEAR, BUT THE SOONER THE BETTER TO NOT MISS OUT ON ANY AWARDS.
(NOTE** Parents & Donors, apply to any and all STO's for scholarships, but please, only use ACSTO for all tax donations as we are one of their preferred partner schools and wish to retain that status.)
corporate only:(must be eligible)
both individual and corporate:
specialty: (specialty scholarship opportunities)
These apply to students with specific circumstances: have an IEP, MET or 504 Plan, have active military parent, have been a ward of the court, reside on a Native American Reservation, or attended a D or F rated school. If one of these circumstances applies to your family, contact our office manager, Sally Rozon or our admissions coordinator, Leigh Webster.
ESA IS EXPANDING THEIR PROGRAM. ALL 2017/18 KINDERGARTEN STUDENTS AT REDEEMER SHOULD APPLY FOR THIS PROGRAM AS SOON AS THE NEW APPLICATION BECOMES AVAILABLE IN JUNE OR JULY 2017.
You may have heard about an ESA (Empowerment Scholarship Account) to help fund tuition at private schools. What is it?
- For the 2017/18 school year, ESA will accept applications from all Kindergarten students and from all students entering grades 1, 6, & 9, who are coming from a public or charter school.
- An ESA is an account provided to parents from the Dept. of Ed. containing state funds for education.
- The amount received varies dependent on school district, grade and student academic needs.
- The amount received is approximately 90% of what the public school receives from the state to educate your child.
- The account is set up with a debit card, issued to the parent.
- The debit card is used to pay for tuition or educational services.
- When using an ESA, you cannot enroll your child at a public/charter school.
- Once you receive an ESA you continue in the program (with renewal procedures each year) until you withdraw.
- Tentative baseline estimate amounts for an account: $2,700 for Kindergarten students (based on half-day public school program), $5,000 average for public school and charter school students
- 5500 new students for 2017-18 will be accepted into the ESA program
- Estimated date for applications to be available: late June/early July
- Estimated notification from AZ Dept. of Ed. for acceptance into the program: mid-August
- Transferring from public/charter school to private school.
- Enrolled in public/charter school for at least 100 days in prior year.
- Entering into K, 1st, 6th or 9th grades for 2017-18.
- If you use an ESA, you CANNOT use the AZ Tuition Tax Credit Program for scholarship awards. Parents must decide to use one program or the other.
- You CAN use AZ Tuition Tax Credit awards until the ESA is finalized. (Possibly during July and August, until ESA is final.)
Which to use? Consider:
- Do I have a pool of donors to approach about utilizing the AZ Tuition Tax Credit Program? (Friends, family, co-workers, neighbors, church members)
- How many tax credit donors do I believe will participate on behalf of my student? What will the total donation amount be that could be awarded to my student?
- Will the total tax credit awards my student receives exceed $5000? (Average amount of ESA for grades 1-8)
- The ESA does not provide full tuition coverage at Redeemer. (Tuition: $6,000) Can I fund the difference through my own resources?