Everything You Need to Know to Maximize Your Child’s Scholarship

Why should I donate to Valley Tuition Organization?

Our Mission is to ensure an affordable private school education for all students.  This means that Valley Tuition Organization works hard to ensure families from all income levels receive assistance to help make private day school possible.

Most importantly, when you donate to VTO you can recommend that your dollars are directed to a school or student of your choice.


When I donate, can I recommend who gets my tax dollars?

VTO will use your recommendation as one of the primary factors we use for granting scholarships.  Just tell us the name of the student and what school they attend and we will do the rest.  As a donor, you can recommend any child K-12 attending a qualified private school as long as they don’t live in your household.

The state tax credit law allows donors to recommend a student or school for a tuition scholarship.   By state law we can’t use the recommendation as the only factor.  Also, state law requires that certain amounts from each donation be used for different types of scholarships.   Some children may only be qualified to receive a portion of the funds donated to them.

 By state law a school Tuition organization cannot award, restrict or reserve scholarships solely on the basis of a donor’s recommendation.   A tax payer may not claim a tax credit if the taxpayer agrees to swap donations with another taxpayer to benefit either taxpayers own dependent.

How can I maximize the scholarship awards my child receives?

The best way you can maximize the scholarship donations for your child is to ask your friends, family, and fellow school families to donate their tax dollars and recommend your child.  The more money we receive in donations the more money we have to award in scholarships.

Be intentional and make a list of people you know who are employed in Arizona, and establish a plan to contact them.  Also, use your social media to reach out to others to tell them about Valley Tuition Organization.  Every person you tell could be another dollar you save on tuition.

For the 2020 tax year, married couples can donate $2,365 and singles can donate up to $1,183.   With these donation amounts it does not take long to make significant impact in your tuition costs.

Another opportunity to maximize your scholarships is to see if the company you work for would consider donating.    There are some laws surrounding these types of donations, but millions of dollars are donated every year with corporate tax credits.   Please call us to discuss if you feel your corporation might be interested in donating.

What are the basics I need to know before I ask people to donate?

The difference between a Tax Credit and a Tax Donation.   A Tax donation is when someone makes a donation to a nonprofit and it is taken as a federal tax deduction.  That means it lowers their taxable income by the amount that is donated.  So if someone makes $50,000 a year and they donate $5,000 to a nonprofit, they only get taxed on $45,000.  Contributions to Valley Tuition Organization are a Tax Credit.   A tax credit is much better than a tax deduction.    An Arizona tax credit is a reduction of a persons’ actual AZ tax liability.  For example, a person who makes $50,000 probably owes about $2,000 in AZ state taxes.   If they contribute the maximum $1,183 to this program, they take a dollar-for-dollar tax credit (reduction) off their state taxes.  So, their net cost is Zero.  They pay that $1,183 either to the state or to this program to help scholarship a K-12 student.

How much a donor can donate.   For the tax year 2020, the maximum a married person can donate is $2,365 ($1,186 in Original income tax credit and $1,179 in Switcher income tax credit) and $1,183 for a single person ($593 in Original income tax credit and $590 in Switcher income tax credit).   Donations less than these amounts are accepted too.

The donation deadlines.  While many people like to give at the end of the calendar year, your donors have until April 15th to donate and take it off the previous year’s taxes.

Common Concerns from potential donors and possible responses: 

I don’t pay taxes, I get a refund.  Most people actually do have to pay state taxes.   Getting a refund doesn’t necessarily mean you didn’t pay state taxes.  Participating in this program has nothing to do with if they are getting a refund or if they owe taxes when they file their return.  It has to do with if they have a tax liability (an amount they pay the state of AZ) when they file their taxes.

Is this the same as the Public School Tax Credit or the AZ Charitable Tax CreditNo, they are totally separate programs.  The state offers many different tax credits and they can participate in them all.


What are the different types of scholarships?

Although we cannot use it as the only criteria, Valley Tuition Organization makes the intentions of the person giving the donation high priority.   Therefore, students of any income bracket are eligible to receive tuition tax credit scholarships, and families who receive more dollars donated in their name will often receive larger scholarships.

There are three types of scholarships:

1) The Original tax credit Scholarship –  There are some general guidelines by the state for these scholarships, but basically most children in private school can receive this scholarship award.  It does not matter what income bracket the family falls in for the Original tax credit scholarship.

2) The Switcher tax credit scholarship –  The state has set some specific award guidelines to receive this type of scholarship.

  • Enrolling in or currently enrolled in a private school Kindergarten, OR
  • Attended an Arizona Public School, full time, for at least 90 days of the prior fiscal year and then transferred to a private school, OR
  • Received a switcher scholarship in a prior school year and remained in private school in subsequent years, OR
  • Received a low-income corporate scholarship or disabled/displaced scholarship in a prior year and continued to attend private school in subsequent years.

 3) The Corporate Low income tax credit scholarship – To qualify for low-income scholarship the family income cannot exceed 342.25% of the poverty level AND meet one of the following:

  • Enrolling in or currently enrolled in a private school Kindergarten, OR
  • Attended a Arizona Public School, full time, for at least 90 days of the prior fiscal year and then transferred to a private school, OR
  • Receive a low-income corporate, switcher or original scholarship in a prior year and continued to attend private school in subsequent years.

Family income must be below the numbers indicated in the chart below.

To Sum it all up,
Why should I donate to Valley Tuition Organization?

  • It costs you nothing to donate because it is a tax credit.
  • The state wants you to participate in this because it saves them money.   This is why they expand the program every year.
  • You are going to be paying the money to someone, either the state of Arizona or VTO to help a child go to private school – This helps day school education.