Spreading Threads Clothing Bank is in search of corporate and community partnerships with local businesses in Tucson and the surrounding areas. By partnering with local businesses and other community organizations, Spreading Threads is hoping to extend its ability to support local youth in foster care as well as the families and agencies that assist them.
Here are some general tax guidelines for corporations, businesses, and other local organizations looking to partner with Spreading Threads Clothing Bank by either making a monetary or in-kind donation:
~C-Corporations (form 1120): Businesses in this tax category can deduct charitable contributions up to 10 percent of taxable income. There was an election for 2021 for the limit to go up to 25 percent of taxable income. Contributions over this limitation can be carried forward up to five years.
~S-Corporations (form 1120S): Partnerships and limited liability corporations (LLCs) pass through the charitable contributions to the owner/partner to report on their personal tax returns. These business entities do not pay income taxes, thus the taxable income flows through to the owners/partners for it to be reported on their personal tax returns.
~Individuals: Individual people can deduct qualified contributions as an itemized deduction up to 60 percent of their adjusted gross income (AGI). In 2021, the federal government allowed up to 100 percent of AGI. If an individual taxpayer does not itemize their deductions on Schedule A, they can take up to $300 for an individual and $600 on a joint return of charitable contributions in addition to their standard deduction.
~Regarding the AZ tax credit and Spreading Threads: Only individual contributions qualify for the credit on their individual AZ tax return. Businesses cannot take the credit or pass the credit through to the partners/owners. Credits are different from deductions. Credits are a dollar-for-dollar reduction of taxes while deductions simply reduce taxable income.
*For additional information about how much your corporation, business, or organization can write off as a tax deduction when it comes to donations made to Spreading Threads Clothing Bank, please check with your tax professional.
To learn more about becoming a corporate or community partner with Spreading Threads Clothing Bank, please contact us at (520) 971-3237 or contact us through our website here.