SB 1496
Initials VP/DD Page 1 Caucus & COW
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature
First Regular Session
Senate: FIN DP 4-3-0-0 | 3rd Read DPA 18-10-2-0-0
House: WM DP 5-2-0-2
SB 1496: tax credit; qualifying charitable organizations
Sponsor: Senator Mesnard, LD 13
Caucus & COW
Overview
Modifies the definitions of services and qualifying charitable organization (QCO) pertaining
to individual income tax credits for QCO's and qualifying foster care charitable organizations
(QFCO's).
History
A QCO is defined as a charitable organization that is exempt from federal income taxation
under section 501(c)(3) of the internal revenue code or is a designated action agency that
receives community services block grant program monies. The charitable organization must
spend at least 50% of its budget on services to Arizona residents who receive temporary
assistance for needy families (TANF), are low-income or have a chronic illness or physical
disability. A QFCO is a QCO which provides services to at least 200 qualified individuals and
spends at least 50% of its budget on services to qualified individuals in Arizona.
Services is defined for QCO's as cash assistance, medical care, child care, food, clothing,
shelter, job placement and job training services or any other assistance that is reasonably
necessary to meet immediate basic needs and that is provided and used in Arizona. For
QFCO's, services is defined as cash assistance, medical care, behavioral health care, child
care, food, including snacks at the qualifying foster care charitable organization's foster youth
events, clothing, shelter, job placement services, job training services, character education
programs, workforce development programs, secondary education student retention
programs, housing or financial literacy services or any other assistance that is reasonably
necessary to meet basic needs or provide normalcy and that is provided and used in Arizona.
In tax year 2025, the individual income tax credit for voluntary cash contributions is not to
exceed: 1) $618 for single individuals and heads of household or $1,234 for married couples
filing jointly for QFCO's; and 2) $495 for single individuals and heads of household or $987
for a married couple filing jointly for QCO's. A taxpayer may contribute to either or both
QCO's and QFCO's and claim a tax credit for either or both credits (A.R.S. § 43-1088).
Provisions
1. Modifies the definition of QCO to require the QCO to direct or spend at least 50% of its
budget on services to state residents who receive TANF, are low-income or individuals
with a chronic illness or physical disability. (Sec. 1)
2. Defines Direct. (Sec. 1)
3. Modifies the definition of services as it relates to QCO's and QFCO's. (Sec. 1)
☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☒ Fiscal Note
SB 1496
Initials VP/DD Page 2 Caucus & COW
4. Modifies the definition of job training services to include job placement and work
activities and any other preparation and training used toward obtaining a high school
equivalent diploma. (Sec. 1)
5. Makes technical and conforming changes. (Sec. 1)