Arizona form 140 - Line 6 (Adjustment to Charitable Contributions)

[InThePoorHouse]

TT did not enter an amount on this line even though I am a full year resident of AZ and have put several contributions on my federal return.  

Line 6 of AZ form 140 states "Amount of charitable contributions for which you are claiming a credit under Arizona law".  Is this all contributions while in AZ or is this something special?  This makes no sense to me since TT didn't put my contributions on this line.

Thank you.  Kurt

[BillM223]

If you took a deduction on the federal return for a charitable contribution that you are claiming as a credit in Arizona, then the amount of the credit needs to be added back to Arizona income, since taking both the credit and the deduction would be double-dipping.

Examples of credits in Arizona:

321
Contributions to Qualifying Charitable Organizations
322
Contributions Made or Fees Paid to Public Schools
323
Contributions to Private School Tuition Organization
331
Donation of School Site
335-I
Contributions made by an S Corporation to a School Tuition Organization - Individual
340
Donations to the Military Family Relief Fund
341-I
Contributions made by an S Corporation to a School Tuition Organization for Displaced Students or Students with Disabilities - Individual
348
Contributions to Certified School Tuition Organization - Individual
352
Contributions to Qualifying Foster Care Charitable Organizations 

Did you take any of these credits in Arizona?

[InThePoorHouse]

Hello Bill, thank you for the reply.  I understand about the potential double dipping but still hoping to clarify further.

My donation "deductions" were claimed on the federal return.  I did not manually enter any additional "claim or credit" on the AZ return (most everything is auto-populated from the fed side).  These federal deductions show as one figure on Arizona Schedule A (Itemized Deductions) line 12.  And I was not prompted to complete any additional AZ forms (i.e. 321, etc.).

On the following page of the AZ return (Itemized Deduction Adjustments), line 6 says 0.00

Its either a glitch in the software (donations should be on line 6 but they're not)...or the 0.00 on line 6 is legit, which is more probable.   Can I assume that if I did not make a manual/specific (additional) claim for credit for the same items on my AZ return, that the 0.00 on line 6 is legit?

Thanks again for the help!  Kurt

[BillM223 · Accepted solution]

"Can I assume that if I did not make a manual/specific (additional) claim for credit for the same items on my AZ return, that the 0.00 on line 6 is legit?"

Yes, absolutely. 

Most of the credits above are entered beginning on a screen with the title "School Tax Credits". You won't get these credits unless you ask for them.

So I would expect a 0.00 on line 6, because it you didn't take any of these credits in Arizona, then there is no reason to have to add the credits amounts back to Arizona income (line 6).

[Mira D]

I have a further question about this topic. I entered the contribution on the Federal part of Turbotax. But then Turbotax determined that it was in my best interest to use the standard deduction. I am on a page titled "Adjustment to State Income Tax Deduction." The associated form is Arizona Schedule A Line 6. When I click on "Learn More" I read:

"Safe Harbor - Guidance on Federal Itemized deduction taken as State Income Tax Deduction for Donations Made to Charitable Organizations

If you made a donation in exchange for a state tax credit and claimed itemize deductions on your Federal return, your Federal return charitable contribution deduction must be reduced as a result of receiving or expecting to receive this state tax credit..."

The page asks me to enter a state income tax adjustment. Since I made a donation for a state tax credit and did NOT claim itemized deductions, do I leave this box blank or do I enter $400, which is the amount we contributed to a school for extracurricular activities?

[BillM223]

Leave it blank.

What's important is not that you entered it in the Itemized Deductions section of the federal return, but whether or not it was used in the Itemized Deductions on your federal return.

Since you are taking the Standard Deduction, it is not being used on the federal return.