Can a donation be a federal deduction and an AZ tax credit?

[mentoraz]

I have a few donations that qualify for Sched A deduction on my 1040.  They are also eligible for several AZ state tax credits on my 140.   I know they cannot be used for both deductions and credits on the state form, but can they remain on the Sched A for federal and then be claimed on my state return? thanks

[Vanessa A]

Yes.  You can take the donations as an itemized deduction on your federal return and then the AZ QCO tax credit on your state return. The maximum credit for AZ  charitable contributions is $842 for Married Filing Jointly and $421 for all other filing statuses. 

Itemized expenses include mortgage interest, gambling losses up to winnings,  charitable contributions, state and local taxes up to $10,000, medical expenses in excess of 7.5% of your AGI and casualty and losses in excess of 10% of you AGI with the first $100 not counting towards the loss.  Your health insurance and all medical expenses are only deductible for the amount that is over 7.5% of your AGI.  This means if your AGI is $50,000, then the amount that is over $3,750 is deductible.  

Then your total itemized expenses would need to be greater than your standard deduction below in order to benefit from your expenses and donations. 

The 2023 Standard Deductions are as follows:

• Married Filing Joint (MFJ)              $27,700
• Married Filing Separate (MFS)      $13,850
• Head of Household (HOH)             $20,800 
• Single                                                     $13,850                                

Blind or over 65 and MFJ or MFS add $1,500

Single or HOH if blind or over 65 add $1,850

Standard versus Itemized Deduction