PDF document

- 1 -

2022 Credit for Corporate Contributions
to School Tuition Organizations for Arizona Form
Displaced Students or Students with Disabilities 341
For information or help, call one of the numbers listed: o Each individual shareholder may claim only a pro
Phoenix (602) 255-3381 rata share of the credit based on the individual’s
From area codes 520 and 928, toll-free (800) 352-4090 ownership interest in the S Corporation.
Tax forms, instructions, and other tax information Any pro rata shares that would be distributed to non-eligible
If you need tax forms, instructions, and other tax information, partners (individual partners in a partnership), or estates or
trusts (shareholders in an S Corporation) is lost.
go to the department’s website atwww.azdor.gov.
Income Tax Procedures and Rulings The total of the credits allowed to all owners may not exceed
These instructions may refer to the department’s income tax the amount that would have been allowed to a sole owner of
procedures and rulings for more information. To view or the business.
print these, go to our website and select Reports & Legal If the allowable tax credit exceeds the taxes otherwise due,
Research from the main menu, then click on Legal Research or if there are no taxes due, the amount of the credit not used
and select a Document Type and a Category from the drop to offset taxes may be carried forward for not more than five
down menus. consecutive taxable years as a credit against subsequent
Publications years' income tax liability.
To view or print the department’s publications, go to our
Claiming the Credit
website, select Reports & Legal Research from the main
menu, and click on Publications in the left hand column. This credit must be pre-approved by the Arizona Department
of Revenue before it can be claimed. The process for
obtaining pre-approval for the credit is available on our
General Information website: www.azdor.gov. Click on “Tax Credits”, then click
This credit provides a nonrefundable corporate income tax on “Corporate Tuition Tax Credits.”
credit for contributions made to a school tuition organization
(STO) authorized to receive corporation donations that Before claiming the credit, obtain a copy of the STO’s pre-
provides scholarships or grants to displaced students or approved application. Include a copy of the pre-approved
students with disabilities. This credit must be pre-approved application with Form 341. Failure to do so could result in a
by the Arizona Department of Revenue. The STO must be disallowance of this credit.
certified pursuant to Chapter 15 of Title 43 at the time of The department will preapprove the credits on a first-come,
donation. first-served basis. The pre-approval process works as
Contributions designated for the direct benefit of a specific follows:
•
student will not qualify for the credit. Before making the contribution, the taxpayer notifies
This credit is in lieu of any deduction taken under Internal the STO of the intended amount.
• The STO requests pre-approval from the Arizona
Revenue Code § 170 for state tax purposes.
Department of Revenue.
A taxpayer cannot claim this credit and the credit claimed on • The Arizona Department of Revenue preapproves or
Form 335 for the same contribution. denies the request within twenty days after it has
The tax credit is equal to the amount the department has pre- received the request, and notifies the STO.
approved. Once pre-approved, the taxpayer has 20 days in • If the request is pre-approved, the STO notifies the
which to make the contribution to the STO. taxpayer immediately.
The tax credit is available only to corporate taxpayers, • The taxpayer must make the contribution within twenty
corporate partners, exempt organizations subject to corporate days of receiving notice from the STO.
income tax on unrelated business taxable income (UBTI), or
S Corporation individual shareholders. QUALIFIED SCHOOL TUITION ORGANIZATION
REQUIREMENTS
• A partnership may pass this credit through only to its
corporate partners, each of which may claim a pro rata The school tuition organization receiving contributions
share of the credit based on their ownership interest. under this program must be certified pursuant to Chapter 15
• An exempt organization may utilize this credit only if it of Title 43 at the time of donation
results from activities that generate UBTI. A listing of certified School Tuition Organizations is
• An S Corporation may claim this credit against income available at www.azdor.gov. Click on “Tax Credits”, then
Arizona is taxing at the corporate level, or it may make click on “Corporate Tuition Tax Credits”, and then click on
“School Tuition Organizations Certified to Receive
an irrevocable election to pass this credit through to its
individual shareholders. Corporate Donations.”
o To pass this credit through to its individual
shareholders, the S Corporation must make Completing the Form
minimum contributions of $5,000 to School Tuition Complete the name and employer identification number
Organizations or to School Tuition Organizations for (EIN) section at the top of the form. Indicate the period
Displaced Students or Students With Disabilities in a covered by the taxable year. Include the completed form
taxable year. with the tax return.

- 2 -

Enlarge image

Arizona Form 341
NOTE: If the entity passing this credit through has a Line 13
different tax year-end than the taxpayer, the taxpayer may Add the amounts entered on lines 11 and 12. Enter the total.
only claim this credit on its tax return for that year. For
example, if the entity passing this credit through has a tax Part 2 – Available Credit Carryover
year end of February 2022, claim this credit on the Use Part 2 to calculate the taxpayer’s total available credit

taxpayer’s 2022 return. carryover from prior taxable years.
All returns, statements, and other documents filed with the S Corporations, if this credit was claimed at the corporate
department require a taxpayer identification number (TIN). level in a prior taxable year and there is a carryover amount
The TIN for a corporation, an exempt organization with available, complete Part 2.
UBTI, an S Corporation, or a partnership is the taxpayer's
EIN. Taxpayers that fail to include their TIN may be subject Lines 14 through 18
to a penalty. • In column (a), enter the taxable year(s) from which the
NOTE – To claim this credit: taxpayer is carrying over the credit
• Individual taxpayers that did not make the Small • In column (b), enter the credit originally computed for
Business Income election, complete Form 341-I and the taxable year listed in column (a)
Arizona Form 301, Nonrefundable Individual Tax • In column (c), enter the amount of the credit from the
Credits and Recapture. Include both completed forms taxable year which was already used
with your tax return. • In column (d), subtract the amount in column (c) from
• Individual taxpayers that made the Small Business column (b), enter the difference
Income election , complete Form 341-I-SBI and Arizona Line 19
Form 301-SBI, Nonrefundable Individual Tax Credits Add the amounts entered on lines 14 through 18. Enter the
and Recapture for Form 140-SBI, 140PY-SBI, 140NR- total in column(d).
SBI, or 140X-SBI. Include both completed forms with
your tax return Part 3 – Total Available Credit
• C corporations, S Corporations claiming this credit at Use Part 3 to calculate the taxpayer’s total available credit
the corporate level, and exempt organizations with for this tax year.
UBTI, complete this credit form and Arizona Form 300,
Nonrefundable Corporate Tax Credits and Recapture. Line 20
Include both completed forms with your tax return. • Partnerships passing through this credit to corporate
• S Corporations electing to pass this credit through to partners, enter “0”.
its shareholders, complete this credit form. Also • Qualified S Corporations electing to pass this credit
complete Form 341-S for each individual shareholder of through to individual shareholders, enter “0”. To
the S Corporation. Provide each individual shareholder determine if the S Corporation qualifies to pass this
a copy of his or her completed Form 341-S. Include credit through to its individual shareholders, complete
Form 341 and one copy of each completed Form 341-S Part 4. If the S Corporation’s total contributions to
with your tax return. STOs from Form 335 and/or Form 341 exceed $5,000,
• Partnerships, complete this credit form. Also, complete the S Corporation qualifies, and may elect, to pass this
Form 341-P for each corporate partner of the credit through to its individual shareholders.
partnership. Provide each corporate partner a copy of • All other corporate entities, (C corporations, exempt
its completed Form 341-P. Include Form 341 and one organizations subject to corporate income tax on UBTI,
copy of each completed Form 341-P with your tax or S Corporations claiming this credit at the corporate
level), enter the amount from line 13.
return. • Also, enter this amount on Form 300, Line 11, column
(a).
Part 1 – Current Taxable Year’s Credit
Line 21
Calculation Enter the amount on line 19, column (d). If the amount is
Lines 1 through 10 zero, enter “0”. Also, enter this amount on Form 300, line
• List each STO’s name and address in column (a). 11, column (b).
• List the credit approval number(s) in column (b). Line 22
• List the approved contribution amount in column (c). Add lines 20 and 21. Enter the total. This is the taxpayer’s
Line 11 total credit for this tax year. Also, enter this amount on
Add the amounts in column (c) on lines 1 through 10 and Form 300, line 11, column (c).
enter that amount on line 11. Partnerships: skip Part 4 and proceed to the instructions
If contributions are made to more than ten organizations, for completing Form 341-P on page 4.

complete and include additional schedules.
S Corporations making the election to pass through this
Line 12 credit, proceed to Part 4.
Corporate partners (only), enter the amount from Form 341-P,
line 13. If none, enter “0”.
2

- 3 -

Enlarge image

Arizona Form 341

Line 25
Part 4 – S Corporation Credit Election Add lines 23 and 24. Enter the total.
An S Corporation may elect to pass this credit through to its Line 26
individual shareholders. Is the amount on line 25 greater than, or equal to, $5,000? If
NOTE: Trusts and estates which are shareholders of S yes, check the “Yes” box and continue to line 27. If no,
Corporations, are not eligible to claim this credit. However, STOP, the S Corporation cannot pass this credit to its
as S Corporation ownership share that is owned by a individual shareholders.
grantor trust that is disregarded for federal income tax Line 27
purposes is treated as owned by the grantor. If the grantor
If the S Corporation wishes to make an irrevocable election
is an individual, he or she may claim his or her share of the
to pass this credit through to its individual shareholders,
credit. enter the ending date for this tax year, check the box
To pass this credit through to its individual shareholders, the indicating the S Corporation is passing this credit through to
S Corporation must have made an aggregate contribution of its individual shareholders, and have this form signed by an
$5,000 or more on Forms 335 and 341 during the tax year. officer of the S Corporation who is also a signatory to
Line 23 Arizona Form 120S.

Enter the total contributions from line 11. Proceed to the instructions on page 4 to complete Form
Line 24 341-S.

Enter the total contributions from Form 335, line 11.

- 4 -

Enlarge image

Arizona Form 341

Form 341-P, Distribution to Corporate Form 341-S, Distribution to Individual
Partners of a Partnership Shareholders of an S Corporation

Enter the name of the partnership and EIN at the top of Form Enter the S Corporation name and TIN at the top of Form
341-P. Enter the corporate partner’s name, EIN, and 341-S. Enter the individual shareholder’s name, Social
ownership percentage on the next line. (Each corporate Security Number, and ownership percentage on the next
partner is entitled to a pro rata share of the credit, based on line. (Each individual shareholder of the S Corporation is
its ownership percentage.) entitled to a pro rata share of the credit based on his/her
Complete Form 341-P for each corporate partner of the ownership percentage.)
partnership. Complete Form 341-S for each shareholder except for trust

Lines 1 through 10 or estate shareholders. However, an S Corporation
• Enter the names of the STO(s) in column (a). ownership share that is owned by a grantor trust that is
disregarded for federal income tax purposes is treated as
• Enter the Credit Approval Number(s) received in
owned by the grantor. If the grantor is an individual, he or
column (b).
she may claim his or her share of the credit.

If contributions are made to more than ten organizations,
complete and include additional schedules. Lines 1 through 10
• Enter the names of the STO(s) in column (a).
Line 11 • Enter the Credit Approval Number(s) received in
Enter the amount of the total current year’s contributions column (b).

from Form 341, Part 1, line 13. If contributions are made to more than ten organizations,
Line 12 complete and include additional schedules.

Enter the corporate partner’s ownership percentage of the S
Line 11
Corporation.
Enter the amount of the total current year’s contributions
Line 13 from Form 341, Part 1, line 13.
Multiply line 11 by line 12. Enter the result. This is the
corporate partner’s portion of this credit. Line 12
Enter the shareholder’s ownership percentage of the S
The partnership must furnish each corporate partner with its Corporation.
completed copy of Form 341-P, including additional
Line 13
schedules as needed.
Multiply line 11 by line 12. Enter the result. This is the
The corporate partner will enter the amount on Form 341-P, individual shareholder’s portion of this credit.
line 13 on its own Form 341, line 12.
The S Corporation must furnish each shareholder with their
copy of Form 341-S, including additional schedules as
needed.

The individual shareholder will use this form to complete
Form 341-I.

PDF file checksum: 881079863

(Plugin #1/9.12/13.0)