AZ HB2345

Increases the individual income tax credit for fees and contributions to public schools from $200 to $300 for single filers/heads of household and from $400 to $600 for married couples filing jointly.

Allows the tax credit to be applied to contributions for standardized testing, career/technical education assessments, test preparation, CPR training, extracurricular activities, character education, and capital items (through June 30, 2022).

Permits taxpayers to carry forward unused credits to offset income tax liability in up to five consecutive taxable years if the credit exceeds taxes owed.

Requires public schools receiving contributions to report to the Department of Revenue by February 28 each year regarding total payments received and how funds were spent by category.

Applies retroactively to taxable years beginning after December 31, 2019.