Private School Tax Credits

There are 3 tax credit programs available to Arizona taxpayers and families in support of educational choice. A detailed explanation of STO requirements for each of these programs can be found here.

School Choice Works…Take the Credit!


Individual Tuition Tax Credit Program

A.R.S. 43-1089 | A.R.S. 43-1089 (Eff. 1/1/11) | A.R.S. 43 Ch. 16 (Eff. 1/1/11)

The Individual Tuition Tax Credit Program allows any Arizona taxpayer to redirect a portion or all of their state tax liability to a School Tuition Organization and receive a 100% dollar-for-dollar tax credit for their contribution. This is a tax CREDIT for supporting school choice, not a tax deduction. At least 90% of every redirected dollar is then awarded by the STO to students who choose a private school that is qualified under the program.

recent study, conducted by Dr. Vicki Murray with the Pacific Research Institute, demonstrated that the program primarily benefits low-and-middle income families, and that the program dramatically expands the ability of parents to select the best schools for their children-public, private, independent, or religious.


Corporate Tuition Tax Credit Program

A.R.S. 43-1183 | A.R.S. 43 Ch. 15 (Eff. 1/1/11)

The Corporate Tuition Tax Credit Program allows any Arizona Corporation to redirect a portion or all of their state corporate tax liability to a School Tuition Organization and receive a 100% dollar-for-dollar tax credit for their contribution. This is a tax CREDIT for corporations supporting school choice, not a tax deduction. At least 90% of every redirected dollar is then awarded by the STO to students who choose a private school that is qualified under the program.

Students receiving scholarships under this program must have family incomes below 185 percent of the income eligible for free and reduced price lunch, which in turn is set at 185 percent of the federal poverty level and must have previously attended a public school or be entering kindergarten.


Disabled/Displaced Pupils Corporate Tax Credit Program (Lexie’s Law)

A.R.S. 43-1184 | A.R.S. 43 Ch. 15 (Eff. 1/1/11)

Lexie’s Law allows any Arizona Corporation to redirect a portion or all of their state corporate tax liability to a School Tuition Organization and receive a 100% dollar-for-dollar tax credit for their contribution. This is a tax CREDIT for corporations supporting disabled/displaced students, not a tax deduction. At least 90% of every redirected dollar is then awarded by the STO to students who choose a private school that is qualified under the program.

Students are eligible for special needs scholarships if they have been enrolled in public school for the previous school year and are taught with an Individualized Education Plan (which is mandated by the Individuals with Disabilities Education Act). Students are eligible for displaced pupil scholarships if they have been placed in foster care at any time prior to graduating from high school. Students do not need to be currently enrolled in a public school to participate.