States / Arizona

Arizona

Last checked Oct 22, 2026

Arizona practitioners use about six state logins for tax and payroll work, run by three agencies and the Arizona Corporation Commission. Nearly all state tax filing still runs through AZTaxes.gov, the front end of BRITS, the integrated tax system Accenture built under a 2002 contract priced at $122.65 million and paid from added enforcement revenue. Its replacement, STARS, uses Voyatek's RevHub software (the vendor was GCOM Software when the contract was awarded in June 2023, with Kyndryl as subcontractor). The legislature budgets the project at $104.8 million, and through November 2025 its budget committee had cleared $53.3 million of spending. It is running late: the first tax type, liquor luxury tax, slipped from February 2025 to March 2026, withholding is next, and the schedule now runs to early 2030. The contract total was not found in a readable state document. Unemployment insurance claims moved to CACTUS, a new benefits system launched 9/7/2025 after a delay from October 2024. The state procurement portal lists it as a Geographic Solutions contract (CTR063562) effective 1/1/2023 and extended to 12/31/2029; the contract amount was not readable, and the Executive estimated the whole project at $73.5 million. Arizona had earlier left the WyCAN consortium, in 2016. Business filings moved from eCorp to the Corporation Commission's Arizona Business Center on 1/12/2026. Arizona has no state paid family and medical leave program; the 2026 bills that proposed one were held in committee.

Who administers what

Every fact links to its source and carries a label: Public record Vendor claim Press / secondary

What the state has spent

Contract totals are the approved ceilings or current contract values the sources state, not money paid, and they are added up only where a plain contract figure exists. The yearly average spreads each system's payments over the years they cover (marked p), or, where no payment data was found, its contract total over the contract term (marked c); systems with neither are left out; it is an estimate of the yearly cost, not a reported figure. Payments to date and project budgets or estimates are added up in their own tiles, from the figures shown in the table; the three kinds of figure overlap and are never added together. Follow each system below for its sources.

Portals practitioners use

Leadership and contacts

Checked Oct 30, 2026. People change roles often; confirm on the agency's site before relying on a name.

Chain of command

• Voters
  • Governor: Katie Hobbs
    • Agency Director: Robert Woods Arizona Department of Revenue
    • Director, Arizona Department of Economic Security: Michael Wisehart Arizona Department of Economic Security
    • Director, Arizona Department of Administration: Elizabeth Alvarado-Thorson Arizona Department of Administration
  • Chairman, Arizona Corporation Commission: Nick Myers Arizona Corporation Commission
• Boards
  • Executive Director: Doug Clark Arizona Corporation Commission

Employer account numbers

Checked Oct 24, 2026.

Two agencies: the Arizona Department of Revenue (ADOR) for income tax withholding, which it keys to the employer's federal EIN rather than a separate state number, and the Arizona Department of Economic Security (DES) for unemployment insurance, which issues its own employer account number. One form starts both: the Arizona Joint Tax Application (Form JT-1), completed on AZTaxes.gov, registers the EIN for withholding with ADOR and begins the UI registration with DES.

Layout: 9 is a digit, A is a letter, other characters are shown as the agency writes them. No real account numbers appear on this site.

Employer tax ID numbers for every state researched

Unemployment insurance tax

Checked Nov 3, 2026. Arizona Department of Economic Security (DES), Unemployment Insurance Tax

Arizona's taxable wage base is fixed by statute at $8,000 per employee for 2023 and later years, and new employers pay 2.0 percent until they have a full year of benefit experience. Experience rates come from reserve ratio tables adjusted each year by a fund control schedule, with a floor of 0.02 percent. DES's own rate pages refused automated reads, so the 2026 and 2027 rate ranges are not recorded here.

Taxable wage base

2027: $8,000
2026: $8,000
Not indexed: $8,000 set in A.R.S. 23-622 for 2023 and every calendar year after ($7,000 from 1983 through 2022). source Public record

New employer rate

2026: 2% Statutory reduced rate for an employer whose account has not been chargeable with benefits throughout the twelve months ending June 30 of the preceding year (A.R.S. 23-729). source Public record

Rate range

2026: ? to ?, Positive and negative reserve ratio tables in A.R.S. 23-730, adjusted each year by the fund control schedule (required income rate by fund ratio) Statutory standard rate 5.4 percent (A.R.S. 23-728); an adjusted rate may not be less than 0.02 percent. The yearly range is published by DES, whose pages were blocked. source Public record

Rate notices

. Protest: File an application for review and redetermination within 15 days after the rate notice is mailed (A.R.S. 23-732). source Public record

Voluntary contributions

Allowed, Voluntary payments made on or before February 28 are credited to the account as of the most recent computation date; accepted payments are not refunded (A.R.S. 23-726). source Public record

Filing

DES UI Tax and Wage System

FUTA credit reduction

None. None: Arizona is not on DOL's 2025 or potential 2026 credit reduction lists (its only reduction in the 2010 to 2025 table was for 2012), and the Treasury Title XII advances data for November 2, 2026 lists only California and Texas. source Public record

des.az.gov and uitws.azdes.gov returned a Cloudflare challenge (403) to every automated request, so the yearly rate range, notice timing, the quarterly report and DES's own descriptions could not be read. Figures here come from the Arizona Revised Statutes.

Not confirmed: 2026 and 2027 experience rate range: DES pages blocked. Search snippets (payroll vendors and DOL's Significant Provisions, July 2026) give 0.03 to 8.36 percent for 2026; not used. 2027 new employer rate and any 2027 rate changes from DES: DES pages blocked. When DES mails the yearly rate notice: DES pages blocked. Quarterly Unemployment Tax and Wage Report form number, due dates and any electronic filing mandate: DES pages blocked. Whether any assessment is charged with UI tax: none found in the statutes read; DES pages blocked.

Unemployment insurance tax in every state

Income tax withholding

Checked Nov 3, 2026

Arizona withholding is a percentage of gross taxable wages that the employee elects on Form A-4 (0.5 to 3.5 percent, or zero with no expected liability); a new employee who files no A-4 within five days is withheld at the 2.0 percent default. Arizona has no reciprocal agreement as such, but residents of California, Indiana, Oregon and Virginia, whose states allow a credit for Arizona tax, may claim exemption on Form WEC. A nonresident is not withheld until physically present in Arizona 60 or more days in a calendar year for an employer with Arizona property, payroll and sales; deposits follow the federal schedule once the four quarter average exceeds $1,500; no local income tax withheld by employers was found.

Withholding certificate

Arizona Form A-4, Employee's Arizona Withholding Election. All employees must complete Form A-4; new employees within 5 days of employment. A zero election must be renewed with a new A-4 by February 15 of the following year. With no certificate on file: 2.0 percent of gross taxable wages until the employer receives a completed Form A-4 (also applies when a zero election is not renewed by February 15). Form WEC, Employee Withholding Exemption Certificate, for a qualified Native American (lives and works on the reservation and is an enrolled member of that tribe), a qualified military spouse under the Military Spouses Residency Relief Act, or a qualified Arizona nonresident. The zero percent election is made on Form A-4, not Form WEC. source Public record

Supplemental wages

2026: No separate supplemental rate was found: ADOR says Arizona income tax withholding is a percentage of gross taxable wages, the amount meeting the federal definition of wages, at the percentage the employee elects on Form A-4. source Public record

Withholding tables

2026 Arizona Form A-4 (percentage election: 0.5%, 1.0%, 1.5%, 2.0%, 2.5%, 3.0% or 3.5% of gross taxable wages, plus any extra amount); Arizona uses elected percentages rather than wage bracket tables (2026). ADOR's forms page lists the 2026 Form A-4 and its employer's instructions. No 2027 Form A-4 was posted as of this check.

Reciprocity

No reciprocal agreements. Residents of California, Indiana, Oregon, Virginia can claim an exemption from withholding. Employee form: Arizona Form WEC, Employee Withholding Exemption Certificate. ADOR does not call this a reciprocal agreement: it is an exemption from Arizona withholding for a nonresident performing services in Arizona who is allowed an income tax credit for taxes paid to the state of residence under A.R.S. 43-1096, and ADOR says it applies to residents of, or those domiciled in, California, Indiana, Oregon or Virginia. The exemption from withholding does not remove the Arizona nonresident filing requirement. source Public record

Nonresidents working here

Withholding is required from a nonresident who is in Arizona for 60 or more days in a calendar year performing services that benefit the employer or a related entity. Below 60 days, no withholding is required if the employer (or a related entity with more than 50 percent common ownership) has property, payroll and sales in Arizona; days in transit, on personal activities, or in training or meetings not directly connected to the Arizona operations are not counted. A nonresident under 60 days may elect withholding, and an out of state business may elect to withhold before 60 days. Nonresidents in Arizona solely for athletic or entertainment purposes are withheld regardless. Employer's Instructions for Arizona Form A-4 (2026); ADOR Withholding Exceptions page. source Public record

Deposits and returns

• annually: previous 4 quarter Arizona withholding average less than $200 (and additional criteria). Due with Form A1-APR by January 31 of the following year
• quarterly: previous 4 quarter Arizona withholding average more than $200 but less than or equal to $1,500. Due with Form A1-QRT: April 30, July 31, October 31 and January 31
• monthly, semiweekly or next business day: previous 4 quarter Arizona withholding average more than $1,500. Due at the same time as the employer's federal withholding deposit

Arizona Form A1-QRT, Quarterly Withholding Tax Return, for quarterly, monthly, semiweekly and one-banking-day payers (including quarters with zero liability), due April 30, July 31, October 31 and January 31; employers that made every payment on time for the quarter get 10 more days (May 10, August 10, November 10, February 10). Annual payers file Form A1-APR by January 31. Employers that owe $500 or more for any taxable year beginning after December 31, 2020 must pay by electronic funds transfer (5 percent penalty for failing to, A.R.S. 42-1125(O)); ADOR offers no general withholding electronic filing or payment waiver for 2022 and later. AZTaxes.gov source Public record

Annual reconciliation

A1-R (or A1-APR for annual payers), due January 31 of the year following the calendar year in which Arizona income tax was withheld. With the W-2 and 1099 filing rules

ADOR keys withholding to the employer's federal EIN, registered on the Arizona Joint Tax Application (Form JT-1). ADOR's Withholding Tax Procedure WTP 16-1 sets out how to determine the deposit schedule. For the Form A1-R annual reconciliation and W-2 filing, see the information returns section.

Not confirmed: No ADOR statement on supplemental wages (bonuses, commissions) was found; rate left null. ADOR's pages say nothing about the federal Form W-4 for Arizona purposes; federalW4 left null. No Arizona statement on a convenience of the employer rule was found; left null. Local taxes: the ADOR pages read describe no city or county income tax withheld by employers; no primary source saying so in terms was saved.

Withholding rules in every state

Credits for other states' taxes and part-year residents

Checked Nov 3, 2026

Arizona gives residents a credit on Form 309 (carried to Form 301) for net income tax paid to another state or a foreign country on income sourced there, but only for states that do not give Arizona residents a credit: nonresident returns filed with California, Indiana, Oregon or Virginia do not qualify. A part-year resident files Form 140PY and keeps nonresident-period income from outside Arizona out by allocation: the ARIZONA column takes income received while a resident plus Arizona source income while a nonresident, and the Arizona income ratio prorates exemptions. Arizona gives a reverse credit to nonresidents who file resident returns in California, Indiana, Oregon or Virginia, and is an associate member of the Multistate Tax Commission.

Residents: credit for tax paid to other states

Arizona Form 309, Credit for Taxes Paid to Another State or Country (a separate Form 309 for each state or country), with Arizona Form 301, Nonrefundable Individual Tax Credits and Recapture; Form 309-SBI and Form 301-SBI for tax on small business income. Line: Form 309, line 17, entered on Form 301, Part 1, line 2, column (a); Form 301 total goes to Form 140, line 51 (Form 140PY, line 61; Form 140NR, line 60). Limit: The smaller of line 11 (Arizona tax liability less all credits except this one, multiplied by income subject to tax in both Arizona and the other state or country divided by the entire income on which Arizona tax is imposed, not more than 1.0000) or line 16 (the other state's or country's income tax multiplied by the doubly taxed income divided by the entire income on which its tax is imposed). Claimed only after all other credits; no carryforward or carryback. Covers: Net income tax paid to a qualifying state or country on income derived from sources there and taxed by Arizona in the same tax year. Qualifying states for Arizona residents' nonresident returns: Alabama, Arkansas, Colorado, Connecticut, Delaware, District of Columbia (only the Unincorporated Business Franchise Tax paid by an individual), Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Utah, Vermont, West Virginia and Wisconsin. Withholding alone does not qualify: a net income tax return must be filed with the other state. No: the credit may not be claimed for income taxes paid to any city or county. Foreign taxes: Yes: a net income tax paid to another country includes taxes that qualify for a credit under IRC sections 901 and 903; Form 309 is required even when federal Form 1116 was not. Pass-through entity taxes: Yes, for 2025, for pass-through taxes paid on the resident's behalf to Alabama, Arkansas, Colorado, Connecticut, District of Columbia, Georgia, Idaho, Illinois, Kansas, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Rhode Island, South Carolina, Utah and Wisconsin; not California, Oregon or Virginia. The credit for entity-level tax may not exceed what would have been allowed had the income been taxed at the individual level (A.R.S. 43-1071(G)). Attach: Include Form 309 and Form 301 with the return. On request, provide a copy of the other state's or country's return (or proof of foreign tax imposed and paid if no return is required), brokerage statements, proof of payment and the currency conversion rate. No credit if the other state allows Arizona residents a credit for tax on income taxed by both: nonresident returns filed with Alaska, California, Florida, Indiana, Nevada, New Hampshire, Oregon, South Dakota, Tennessee, Texas, Virginia, Washington and Wyoming do not qualify, and the taxpayer may instead claim a credit for Arizona tax on the nonresident return filed with that state. The department's procedure ITP 08-1 explains the computation. A.R.S. 43-1071. source Public record

Part-year residents: income while a nonresident

Allocated or prorated Form 140PY, lines 15 through 26, has a FEDERAL column (amounts from the federal return) and an ARIZONA column: income received while an Arizona resident, plus Arizona source income for the part of the year as a nonresident. Arizona gross income is the part of federal AGI earned during residency (regardless of source) plus Arizona source income while a nonresident. The Arizona income ratio (line 26 divided by line 25, not over 1.000) prorates exemptions (line 51); tax is 2.5% of Arizona taxable income. Form 140PY, Part-Year Resident Personal Income Tax Return. Line: Form 140PY, ARIZONA column, lines 15 to 26; line 27 (Arizona income ratio). source Public record

Part-year residents: credit for the period of residence

Available. For the part of the year as an Arizona resident, follow the resident instructions; for the part as a nonresident, follow the nonresident instructions. Form 309 with Form 301, claimed on Form 140PY, line 61. source Public record

Nonresidents: reverse credit

Yes, for residents of California, Indiana, Oregon, Virginia. Allowed to Arizona nonresidents whose state of residence does not allow them a credit for tax paid to Arizona, if that state either does not tax Arizona residents on income from its sources or allows Arizona residents a credit. The income must have its source in Arizona. Nonresidents filing resident returns in California, Indiana, Oregon or Virginia qualify; for the PTE credit, California, Oregon and Virginia. The department says the list is subject to change at any time. Claimed on Form 309 with Form 140NR. source Public record

Local income taxes

Arizona has no local income tax; the Form 309 credit excludes income taxes paid to any city or county. source Public record

Multistate Tax Compact

Associate member. source Public record

Other interstate rules

• Dual resident credit: a full-year Arizona resident who is also a resident of another state under that state's law may claim the credit for that state's tax, but only on income that would be sourced to that state on a nonresident return (Schedule of Income Allocation, Form 309 page 2). source Public record
• Residency is domicile: a resident who leaves Arizona for a temporary period is still an Arizona resident while gone (ITP 92-1 covers residency status). source Public record

Tax year 2025 Form 309 and instructions and the Form 140, 140PY and 140NR booklets. The withholding data covers Form WEC, the withholding exemption for residents of the reverse-credit states under A.R.S. 43-1096.

Not confirmed: No 2026 change to the credit found in the 2025 instructions; not checked against 2026 legislation. UDITPA or apportionment status not checked against a primary source.

Multistate rules in every state

Business return deadlines and annual reports

Checked Nov 4, 2026

A corporation files Form 120 with the Department of Revenue by the 15th day of the fourth month after its tax year closes (April 15, 2026 for calendar 2025); Form 120EXT or a valid federal extension gives up to six more months to file, and at least 90 percent of the tax must be paid by the original due date. S corporations (Form 120S) and partnerships (Form 165) file by the 15th day of the third month (March 16, 2026 for calendar 2025). Only corporations file an annual report with the Arizona Corporation Commission, by their designated due date each year ($45 for-profit, $10 nonprofit, with a $9.00 monthly penalty for a late for-profit report); LLCs file no annual report.

Corporate return

Corporate income tax. Form 120, Arizona Corporation Income Tax Return. Due: By the 15th day of the fourth month following the close of the taxable year (timely if postmarked the next business day when the due date falls on a Saturday, Sunday or legal holiday). For tax year 2025: Apr 15, 2026. Fiscal years: Corporations and partnerships must file electronically (A.R.S. 43-323(F)). source Public record

Corporate extension

By request. Up to six months. Arizona Form 120EXT (shown as Form 120/165EXT in the 2025 instructions), filed by the original due date; the Department also accepts a valid federal extension for the same period. Not an extension to pay. The extension underpayment penalty applies if at least 90 percent of the tax liability shown on the return is not paid by the original due date.

S corporations

Form 120S, Arizona S Corporation Income Tax Return. Due: On or before the 15th day of the third month following the close of the S corporation's taxable year (March 15 for a December 31 year end). For tax year 2025: Mar 16, 2026. Arizona Form 120/165EXT or a federal extension, requested by the original due date; not an extension to pay: 90% of the tax liability (including the $50 minimum tax) must be paid by the original due date. source Public record

Partnerships

Form 165, Arizona Partnership Income Tax Return. Due: On or before the 15th day of the third month following the close of the partnership's taxable year (March 15 for a December 31 year end). For tax year 2025: Mar 16, 2026. Arizona Form 120/165EXT or a federal extension; the department accepts a valid federal extension for the same six-month period. source Public record

Individuals

Form 140 (residents). For tax year 2025: Apr 15, 2026. Automatic 6-month extension to October 15, 2026, with Arizona Form 204 or a federal extension (Form 4868); an extension does not extend the time to pay. source Public record

Annual report

Filed with the Arizona Corporation Commission, Corporations Division through Arizona Business Center.

An annual report extension does not change later due dates. Benefit corporations also file an Annual Benefit Report each year. Limited partnerships and LLPs register with the Arizona Secretary of State, not the Corporation Commission; whether they file a periodic report was not confirmed. The startup step's facts match these sources.

No due date change for tax year 2026 was found on the Department of Revenue pages and 2025 instructions read. March 15, 2026 fell on a Sunday, so the 2025 Form 120S and Form 165 dates are given as March 16, 2026 under the next-business-day rule on the corporate income tax page.

Not confirmed: Whether Arizona LPs or LLPs file any annual report with the Secretary of State was not confirmed. The statute behind the $9.00 monthly penalty, and any cap on it, was not read. The 2025 Form 120 instructions (FORMS_CORPORATE_2025_120_i.pdf) were not read; the corporate due date and extension come from the Department's web pages.

Deadlines and annual reports in every state

Electronic payment, penalties and interest

Checked Nov 4, 2026

Arizona requires electronic payment from a business that owes $500 or more in a year in transaction privilege and use tax, withholding or corporate income tax; paying another way costs 5% of the payment. Individual income tax is excluded from the mandate. A late return draws 4.5% of the tax a month up to 25%, and late payment 0.5% a month up to 10%, with the two together capped at 25%. Interest on underpayments and overpayments is 7% a year from July 1 to December 31, 2026.

Interest on unpaid tax

The federal short-term rate under IRC 6621(b) plus three percentage points, for both underpayments and overpayments, applied in the same manner and at the same times as IRC 6621. Refunds on an original return earn interest only if not paid within 60 days. No rate for 2027 had been posted. Compounding: Annually: on January 1 each year, outstanding interest is added to the tax principal. A.R.S. 42-1123. source Public record

When tax must be paid electronically

• Sales and use: $500 annual transaction privilege tax and use tax liability (2021 and beyond); $5,000 in 2020. Methods: AZTaxes.gov or an accepted EFT method. Register on AZTaxes.gov. Penalty for paying another way: 5% of the amount of a payment made by check or cash (A.R.S. 42-1125(O)). source Public record
• Withholding: The employer owes $500 or more for any taxable year beginning from and after December 31, 2020. Methods: Electronic funds transfer (A.R.S. 42-1129; A.A.C. R15-10-301 to R15-10-307). No general withholding e-pay waiver is offered for 2022 and later. Penalty for paying another way: 5% of the amount of the payment not made by EFT (A.R.S. 42-1125(O)). source Public record
• Corporate: The corporation owes $500 or more for any taxable year beginning from and after December 31, 2020 ($5,000 for taxable years in 2020). Methods: AZTaxes.gov (ACH debit) or ACH credit; credit or debit card as a guest payment on AZTaxes.gov. ACH debit: register at AZTaxes.gov; ACH credit: Form 10366, Authorization For Electronic Funds Transfer and Disclosure Agreement for Credit Filers. Penalty for paying another way: 5% of the amount not paid by EFT, unless due to reasonable cause (A.R.S. 42-1125(O)). source Public record

Penalties

Late filing

Covers: Returns for taxes administered under the article that contains A.R.S. 42-1125; a separate minimum and maximum apply to returns under Title 42, chapters 5 and 6 (transaction privilege and use tax, per the ADOR TPT page). 4.5% of the tax required to be shown on the return for each month or fraction of a month late, after reducing it for tax paid on time and credits. Maximum: 25% of the tax remaining due; for TPT and use tax returns, 25% of the tax or $100, whichever is greater. Minimum: TPT and use tax returns: 4.5% or $25 a month, whichever is greater. A.R.S. 42-1125(A) and (X). source Public record

Late payment

Covers: The amount shown as tax on a return, not paid within the time prescribed. 0.5% of the tax for each month or fraction of a month the failure continues. Maximum: 10%. They stack, but when the late filing penalty also applies for the same period the two together may not exceed 25%. A taxpayer in a payment agreement found to have reasonable cause is not charged the penalty unless it fails to comply with the agreement. A.R.S. 42-1125(D). source Public record

Estimated tax, individuals

Charged as penalty. Equal to the interest that would accrue under A.R.S. 42-1123 on the unpaid amount for the period of nonpayment, not more than 10% of the amount not paid; charged in place of other penalties and interest (A.R.S. 42-1125(Q)). Safe harbor: Required when Arizona gross income exceeded $75,000 ($150,000 joint) this year and last year: withholding plus estimates must total at least 90% of this year's tax or 100% of last year's tax. No penalty if the IRC 6654 exceptions apply or the tax due on the return after withholding and credits is less than $1,000. Form: Arizona Form 221. source Public record

Estimated tax, corporations

Charged as penalty. Equal to the interest that would accrue on the underpaid installment, not more than 10% of the amount not paid (A.R.S. 42-1125(Q)). Safe harbor: Required when the year's tax is at least $1,000; the required annual payment is the lesser of 90% of this year's tax or 100% of last year's tax (the prior year must be 12 months with a return showing tax). A large corporation (federal taxable income of $1 million or more in any of the three prior years) may use the prior year only for the first installment. Form: Form 220/PTE, Underpayment of Estimated Tax By Corporations and Pass-Through Entities. source Public record

Penalty relief

Penalties are not charged when the failure is shown to be due to reasonable cause and not willful neglect (A.R.S. 42-1125). Request abatement of non-audit penalties on Form 290; the account must be in compliance (no delinquent returns and all non-audit liabilities paid). Audit-assessed penalties go to the Audit Unit instead. Interest is not abated for reasonable cause. How: Form 290, Request for Penalty Abatement. source Public record

Other penalties

• No return filed after notice and demand. 25% of the tax, in addition to the late filing penalty (for TPT and use tax, 25% or $100, whichever is greater). source Public record
• Amount not shown on a return and not paid within 21 days of notice and demand. 0.5% a month, up to 10%; 25% combined cap with the late filing penalty. source Public record
• Withholding not remitted by the due date. Up to 25% of the amount required to be withheld and paid. source Public record
• Information return (or chapter 3 return or report) not filed on time or incomplete. $100 for each month or fraction of a month, up to $500 per return or report. source Public record
• Deficiency due to negligence. 10% of the deficiency. source Public record
• Deficiency due to fraud. 50% of the total tax. source Public record
• Failing to furnish information the department requested in writing. Up to 25% of the deficiency assessed. source Public record
• Frivolous return. $500. source Public record
• TPT return filed on paper when e-filing is required. 5% of the tax due, minimum $25, including zero-liability returns. source Public record

The electronic payment mandate in A.R.S. 42-1129 excludes individual income tax; individuals may pay estimates by check, electronic check, money order or credit card. A.R.S. 43-581(C) also requires estimated payments from a partnership or S corporation that elects the pass-through entity tax when its taxable income exceeded $150,000 in the preceding year.

Not confirmed: The interest rate for January 1, 2027 had not been posted on the ADOR table as of 2026-11-04. A time limit for filing Form 290 and any first-time abatement policy were not found. A.A.C. R15-10-301 to R15-10-307 (the EFT rules) were not read.

Electronic payment, penalties and interest in every state

Disaster relief rules

Checked Nov 4, 2026

Arizona follows IRS postponements by statute: when IRC section 7508A applies, A.R.S. 42-2079 says the director shall specify a period of up to one year to extend any due date and suspend penalty and interest for affected taxpayers, and the same applies when the governor declares a state of emergency. The Department of Revenue's 2007 summary says the rule covers all tax types administered under Title 42. The director sets the period; no recent Department of Revenue notice under the statute for a disaster was found.

When the IRS postpones deadlines

Follows IRS postponements automatically, for some or all taxes A.R.S. 42-2079(A): "the director shall specify a period of up to one year to extend any due date and suspend any penalty or interest that would ordinarily accrue during that time for any affected taxpayer in any of the following circumstances: 1. Section 7508A of the internal revenue code relating to disasters and terroristic and military actions applies. 2. The governor has declared a state of emergency pursuant to section 26-303, subsection D.". Affected taxpayers in the covered area: individuals whose principal residence is there, businesses whose principal place of business is there, relief workers assisting there for a recognized government or philanthropic organization, taxpayers whose records needed to file or pay are kept there, the spouse on a joint return, and anyone else the director determines. The statute is triggered whenever section 7508A applies; it does not limit this to FEMA declarations. A.R.S. 42-2079. The Department of Revenue's 2007 legislative summary describes SB 1036 (Chapter 132) as creating this relief, without giving the section number. source Public record

Taxes covered

"Any due date" (A.R.S. 42-2079(A)); the Department of Revenue's 2007 legislative summary says the legislation "will grant relief to all tax types administered under Title 42.". Not covered: Set by the director's notice. In the COVID-19 notice under the statute (GTN 20-1) estimated payments due April 15, 2020 were not extended, and the April 15, 2020 date to choose the tax year for certain credit contributions stayed, because state law did not let the director change it. source Public record

State-declared disasters

A.R.S. 42-2079(A)(2) applies the same relief when the governor declares a state of emergency under section 26-303(D). GTN 20-1 (2020, COVID-19) was issued under A.R.S. 42-2079(A)(2) and the governor's declaration and suspended late filing and payment penalties and interest for income tax returns and payments made by July 15, 2020. source Public record

How to get relief

Penalties: Penalties and interest that would accrue during the period the director specifies are suspended for affected taxpayers, and interest does not accrue on unpaid tax during that period (A.R.S. 42-2079(A) and (B)). source Public record

Where relief is posted

Tax Notices (Arizona Department of Revenue); no disaster relief page was found

Other disaster tax rules

• Since Jan. 1, 2015, out-of-state businesses and out-of-state employees in Arizona temporarily and solely for disaster recovery work during a disaster period are exempt from certain Arizona taxes; their income from that work is exempt from Arizona income tax (Pub. 720; Form 140NR instructions). source Public record

Recent changes

• SB 1036 (2007, Chapter 132) created the rule; the Department of Revenue's 2007 summary describes it as allowing the director to grant relief, while the current statute says the director shall specify a period. source Public record

The status is automatic because the statute requires relief whenever section 7508A applies, but the length of the period is set by the director (up to one year). No current Arizona IRS postponement is in disasters.json.

Not confirmed: No Department of Revenue notice specifying a period under A.R.S. 42-2079(A)(1) for an IRS disaster postponement was found (the tax notices and press release lists show none), so how a taxpayer claims relief and whether it is applied automatically by address is not stated. When the statute changed from allowing to requiring relief (may to shall) was not confirmed from a session law. Department of Economic Security unemployment insurance disaster relief and any TPT exemption for disaster rebuilding were not researched.

Current disaster relief and every state's rules

Federal tax picture

From the IRS's own statistics: the Data Book for fiscal 2025 and Statistics of Income for tax year 2023. Every state

Collected by type: Individual income tax withheld and FICA tax $54.9B; Individual income tax payments and SECA tax $19.9B; Business income taxes $3.7B; Excise taxes $1.9B; Estate and trust income tax $632M; Estate tax $317M; Unemployment insurance tax $164M; Gift tax $147M; Railroad retirement tax $2.0M. source Public record

Filers moving in and out, 2022 to 2023

121,675 returns (202,429 people) with $10.6B of income moved in from other states; 104,359 returns (175,302 people) with $7.9B moved out, a net gain of $2.8B in income. source Public record

Minimum wage

Checked Nov 3, 2026. Industrial Commission of Arizona, Labor Department

Arizona's minimum wage is indexed: it rises each January 1 by the August to August change in the U.S. CPI-U, rounded to the nearest five cents (A.R.S. 23-363).15 for 2026 and $15.65 for 2027, and they are left out here until confirmed. Employers may pay tipped employees up to $3.00 an hour less than the minimum wage, and Flagstaff ($18.35 in 2026, $18.95 in 2027) and Tucson ($15.45 and $16.00) set higher local minimums. The Industrial Commission posts $15.15 for 2026 and $15.65 from January 1, 2027.

Rate

$15.15 from Jan 1, 2026
$15.65 from Jan 1, 2027 source Public record

How it is set

Indexed: CPI-U (all urban consumers, U.S. city average, all items), August to August, rounded to the nearest five cents A.R.S. 23-363 (Fair Wages and Healthy Families Act, 2016 Proposition 206) source Public record

Tipped employees

2026: cash wage $12.15, tip credit $3.00 Up to $3.00 an hour less than the minimum wage if tips plus wages reach the minimum each week (cash wage computed as $15.15 less $3.00).
2027: cash wage $12.65, tip credit $3.00 Same rule (cash wage computed as $15.65 less $3.00). source Public record

Local minimum wages

Allowed

• Flagstaff (no tip credit: tipped employees get the full local minimum wage): $18.35 in 2026, $18.95 in 2027 source Public record
• Tucson (tip credit of no more than $3.00): $15.45 in 2026, $16.00 in 2027 source Public record

source Public record

Poster

The Fair Wages and Healthy Families Act (2027 poster)

Recent and coming changes

• Jan 1, 2027 Flagstaff minimum wage rises to $18.95 (the city first announced $19.00, then corrected it). source Public record
• Jan 1, 2027 Tucson minimum wage rises to $16.00. source Public record

A.R.S. 23-364 lets a county, city or town regulate minimum wages by ordinance above the state rate; A.R.S. 23-362 (1997), which bars local minimums above the federal rate, is still printed in the statutes. Flagstaff's 2027 increase used a 3.40 percent CPI change from August 2025 to August 2026. Arizona has no state exempt salary threshold above the federal level found.

Not confirmed: When the Industrial Commission announces the next rate: not confirmed (it was reportedly posted in late September 2026). Youth or training wage: none found in A.R.S. 23-363; the statutory exemptions and definitions were not reviewed.

Minimum wage in every state

Paid family and medical leave

Checked Nov 3, 2026. No program

Arizona has no paid family and medical leave or temporary disability insurance program funded by payroll contributions, so there is no rate, wage base or report for 2026 or 2027. Its paid leave law is earned paid sick time under A.R.S. 23-372, which employers provide directly.

Under A.R.S. 23-372, employees accrue at least one hour of earned paid sick time for every 30 hours worked, up to 40 hours a year at employers with 15 or more employees and 24 hours at smaller employers, unless the employer sets a higher limit. It is employer-paid, with no state fund or contribution. No voluntary state paid leave insurance program and no enacted program awaiting start was found.

Not confirmed: No Arizona agency page saying in words that the state has no paid family and medical leave insurance program was found; the absence rests on the statute read and on finding no program.

Paid leave in every state

Sick leave and time off

Checked Nov 5, 2026. Paid sick leave

Arizona's Fair Wages and Healthy Families Act (Proposition 206, 2016) requires private employers to give earned paid sick time of at least one hour per 30 hours worked, up to 40 hours a year at employers with 15 or more employees and 24 hours at smaller employers, since July 1, 2017. Arizona has no state family and medical leave law and relies on the federal FMLA. No statute or agency guidance read says whether unused vacation must be paid out at separation.

Paid sick leave

The law

Fair Wages and Healthy Families Act (earned paid sick time), Proposition 206 source Public record

Employers covered

All private employers of any size, and political subdivisions; not the State of Arizona or the United States. Employers with 15 or more employees (counting full-time, part-time and temporary employees; an employer that fluctuates is covered if it had 15 or more on the payroll in 20 different weeks in the current or preceding year) give up to 40 hours a year; employers with fewer than 15 give up to 24 hours.

Employees not covered

Persons employed by a parent or sibling, casual babysitters in the employer's home, and employees of the State of Arizona or the U.S. government. Employees under a collective bargaining agreement that expressly waives the requirements in clear and unambiguous terms. Recipients of public benefits in required work activity are covered.

How it builds up

At least 1 hour per 30 hours worked; overtime-exempt employees are assumed to work 40 hours a week (or their normal shorter week).

Yearly cap

40 hours accrued or used a year at employers with 15 or more employees; 24 hours at employers with fewer than 15; the employer may set a higher limit.

Front-loading

Allowed: the employer may give the full year's amount at the beginning of the year.

When use can start

The employer may require an employee hired after July 1, 2017 to wait until the 90th calendar day of employment before using accrued time.

Carryover

Unused time carries over, subject to the yearly use limits; instead the employer may pay out unused time at year end and front-load the full required amount for the next year.

Allowed uses

The employee's or a family member's illness, injury, health condition, diagnosis, care or preventive care; public health emergency closures of the workplace or a child's school or care, or exclusion from the community after exposure to a communicable disease; needs arising from domestic violence, sexual violence, abuse or stalking. Family members: children, parents and parents-in-law, spouse or registered domestic partner, grandparents, grandchildren and siblings of the employee or spouse or partner, and anyone whose close association is the equivalent of a family relationship.

Notice and documentation

Request orally, in writing or electronically; good faith advance notice when foreseeable. An employer that requires notice of unforeseeable absences must have a written notice policy and give it to the employee. Documentation may be required for three or more consecutive work days, without details of the condition. Time may be used in hourly or smaller payroll increments.

At the end of employment

Not required at separation (the employer may choose to pay it out). An employee rehired within nine months gets back previously accrued, unused time.

PTO policies

Yes, if the paid leave policy gives enough time to meet the accrual requirements, usable for the same purposes and under the same conditions.

Employer duties

Written notice of the rights at hire (in English, Spanish and any language the Industrial Commission deems appropriate); workplace poster; the available balance, the time used so far in the year and the sick pay received must appear on or with each regular paycheck; payroll records of hours worked and wages and sick time paid kept for four years.

Enforcement

Industrial Commission of Arizona, Labor Department. Civil penalty of at least $250 for a first notice, posting or recordkeeping violation and at least $1,000 for later or willful ones; unpaid sick time plus interest and twice the unpaid amount; at least $150 a day for retaliation. Private civil action within two years (three if willful), with attorney fees to a prevailing plaintiff.

Citation

A.R.S. 23-371 to 23-381 (enforcement at 23-364), Proposition 206, approved by the voters November 8, 2016, in effect since Jul 1, 2017

Agency guidance

azica.gov

Local laws: A.R.S. 23-204 declares the regulation of employee benefits, including paid and unpaid leave, a matter of statewide concern not subject to further regulation by cities, towns or other political subdivisions. The Proposition 206 statutes say the opposite for sick time: the article does not supersede any local law giving greater paid sick time rights (23-378(C)), and a county, city or town may regulate minimum wages and benefits by ordinance (23-364(I)). How the two fit was not resolved in any source read; no local paid sick leave ordinance was found. (A.R.S. 23-204; A.R.S. 23-378(C); A.R.S. 23-364(I)) source Public record

Family and medical leave

No state family and medical leave law found; Arizona relies on the federal FMLA.

Vacation and PTO at the end of employment

Not addressed No statute or agency guidance read addresses vacation pay at separation. The wage payment law defines wages as nondiscretionary compensation the employee has a reasonable expectation to be paid, due within seven working days or the next regular payday (whichever is sooner) after a discharge and by the regular payday after a resignation; whether accrued vacation is such a wage depends on that expectation, which no source read settles. (A.R.S. 23-350(7); A.R.S. 23-353) source Public record

Other leave the law requires

What was checked: Statutes read on azleg.gov (A.R.S. 23-371 to 23-381, 23-364, 23-204, 23-350, 23-353, 21-236, 16-402, 26-167, 26-168, 13-4439) and the Legislative Council's 2016 analysis of Proposition 206. The paid sick time statutes carry the Proposition 105 (voter protection) caution. Domestic violence leave is covered as a use of earned paid sick time, and crime victim leave by 13-4439. A.R.S. 26-167 only bars depriving National Guard members of employment, so it is not listed separately. No Arizona statute was found requiring private employers to give bereavement, school activity, donation, volunteer responder, pregnancy or holiday leave; Arizona does not require holidays off or holiday premium pay. No 2025 or 2026 change to the sick time statutes was found.

Not confirmed: azica.gov (Industrial Commission) returns a Cloudflare challenge to curl and WebFetch, so the earned paid sick time FAQ and posters were read only as government index excerpts: https://www.azica.gov/frequently-asked-questions-about-wage-and-earned-paid-sick-time-laws and https://www.azica.gov/sites/default/files/media/EPST_MW_FINAL.pdf The Commission's earned paid sick time rules (A.A.C. R20-5-1201 and following) were not read; apps.azsos.gov returned 403: https://apps.azsos.gov/public_services/Title_20/20-05.pdf Vacation payout: no ICA guidance or court ruling on vacation at separation was read; the answer 'not addressed' rests on the wage statutes alone. Preemption: how A.R.S. 23-204 interacts with A.R.S. 23-378(C) and 23-364(I) was not resolved, and the session law that enacted 23-204 was not read. No volunteer firefighter or emergency responder leave statute was found in the government index searches; a fuller search of Titles 9, 23 and 48 was not done.

Federal law adds unpaid FMLA leave at employers with 50 or more employees and paid sick leave for federal contractors. Sick leave and time off in every state

Transaction privilege tax (TPT) and use tax

Checked Nov 3, 2026

Arizona has no sales tax in the usual sense: its transaction privilege tax (TPT) is a tax on the vendor for the privilege of doing business, which the vendor may pass on to buyers; the state rate for retail sales is 5.6 percent, and counties and cities add their own TPT, all collected by the Arizona Department of Revenue (ADOR). A remote seller must get a TPT license and pay once its direct (non-marketplace) gross sales to Arizona customers are more than $100,000 in the previous or current calendar year.

State rate

5.6% A.R.S. 42-5010(A)(1)(l) (5 percent, retail classification) plus the 0.6 percent additional rate increment of A.R.S. 42-5010.01, imposed from and after June 30, 2021 through June 30, 2041
Rates vary by business classification; ADOR's rate table lists food for home consumption under its own business code (062), used for city tax. source Public record

Local taxes

Yes, collected by the state. Counties levy an excise tax and 91 cities and towns levy city privilege tax, at rates that vary by business activity, city and county; ADOR collects the county and city taxes with the state TPT on the same return, using region and city codes from its monthly rate tables. Some cities use tiered rates for single items over a set price; the state and counties do not. ADOR's agreement with the municipalities gives a 60-day period before a city rate change takes effect. Remote sellers and marketplace facilitators report to the customer's shipping address (billing address if none) and have their own rate tables. Rate lookup source Public record

Remote sellers

$100,000; counts gross: gross proceeds of sales or gross income from the remote seller's business with Arizona customers under the retail classification, not counting sales facilitated by a marketplace facilitator; affiliated persons are aggregated sales; previous or current calendar year; since Oct 1, 2019. Get a TPT license from ADOR once the threshold is met, and begin remitting on the first day of the month that starts at least 30 days after it is met, for the rest of that year and the next calendar year. The remote seller threshold phased down: more than $200,000 for 2019, $150,000 for 2020 and $100,000 for 2021 and later. Arizona never had a transaction count. A person that does not meet the threshold in the next calendar year need not remit for the year after and may cancel its license. source Public record

Marketplace facilitators

Must collect (More than $100,000 of gross sales or income in the previous or current calendar year, counting its own sales and those it facilitates for at least one marketplace seller; marketplace sellers selling only through a facilitator do not need a license for those sales.), since Oct 1, 2019 source Public record

Streamlined Sales Tax

Not a member source Public record

Registration

Transaction privilege tax (TPT) license, applied for on the Arizona Joint Tax Application (Form JT-1/UC-001) or on AZTaxes.gov, $12 per location for the state license; city license fees vary (waived for remote sellers and marketplace facilitators) Register Out-of-state sellers use the same TPT license; ADOR's out-of-state sellers pages give its licensing steps, and its E-Commerce Compliance and Outreach team answers remote seller questions. Locations with the same owner can be consolidated under one license. source Public record

Filing

• monthly: more than $8,000 estimated annual combined state, county and city TPT liability, or 8 months or less of business activity
• quarterly: $2,000 to $8,000 estimated annual combined tax liability
• annual: less than $2,000 estimated annual combined tax liability

Due: TPT is due on the 20th of the month after the end of the tax period. Under the grace period an electronic return and payment are timely if received by the last business day of that month, and a paper return and payment if received by the second to last business day; penalties and interest run from the 20th if the grace period is missed.
Electronic filing: Electronic filing and payment are required for taxpayers with $500 or more in annual TPT and use tax liability (2021 and later; A.R.S. 42-5014 and 42-1129); penalties apply for paper filing or payment.
Vendor discount: Accounting credit on state tax: 1.2 percent of the tax due, up to $12,000 a calendar year, for taxpayers that file electronically all year; 1 percent, up to $10,000, for paper filers (A.R.S. 42-5017). It is not allowed if the tax is paid late.
AZTaxes.gov source Public record

Certificates

Resale: Arizona Resale Certificate, Form 5000A, completed by the purchaser and kept by the vendor, to document purchases of tangible personal property for resale in the purchaser's regular course of business.
Exemptions: ADOR publishes exemption certificates (TPT forms) that the purchaser completes and gives the vendor at the time of sale, as the basis for state and city deductions or exemptions. source Public record

Recent and coming changes

• Oct 1, 2025 Businesses inside the new Maricopa County Stadium District (Laws 2025, Chapter 251, H.B. 2704) must report under county region code MCZ and city region code PZ, starting with October 2025 returns; no new tax. source Public record
• Jan 1, 2025 City TPT on residential rental income (stays of 30 days or more) ended; there is no state or county tax on residential rentals (Laws 2023, Chapter 204). source Public record

hasSalesTax is false because ADOR describes TPT as a tax on the vendor for the privilege of doing business that differs from a true sales tax; the rate, nexus, marketplace, registration and filing fields describe TPT, which stands in for a sales tax and is commonly called one. The 5.6 percent state rate applies to the retail classification and several others listed in A.R.S. 42-5010(A)(1); other classifications have other rates (for example 5.5 percent for transient lodging). ADOR's November 2026 rate table lists no rate changes for November 1, 2026.

Not confirmed: Whether ADOR accepts the Multistate Tax Commission or Streamlined certificates for resale: not found on ADOR pages read. State treatment of food for home consumption: the rate table shows a business code for it, but the state exemption itself was not read in a primary source, so no reduced-rate statement is made. Effective date of the 5.6 percent combined state rate: A.R.S. 42-5010.01 imposes the current 0.6 percent increment from and after June 30, 2021, but an earlier provision for the same increment was not read, so the date the combined rate first applied is left null.

Sales tax in every state

Credit card surcharges

Checked Nov 4, 2026. No state surcharge law

No Arizona statute was found that bars, caps or sets notice rules for a business adding a surcharge to a credit card purchase; card network rules and federal law still apply. A 2026 Senate bill (SB 1623) that would have barred credit card surcharges was introduced only. The Department of Revenue has published no guidance found on whether a card surcharge is part of the transaction privilege tax base, though the statute's tax base allows no deduction for the seller's expenses.

The rule

No state law on credit card surcharges by sellers was found.

Cash discounts

No state law on cash discounts instead of card surcharges was found. For transaction privilege tax, cash discounts allowed and taken on sales are not included in gross income (A.R.S. 42-5001). (A.R.S. 42-5001) source Public record

Sales tax on the surcharge

Not stated No Department of Revenue ruling or guidance on card surcharges was found. The transaction privilege tax statutes define gross proceeds of sales as the value from the sale of tangible personal property without any deduction for the cost of property sold, expense of any kind or losses, and presume that all gross proceeds and gross income from a taxable business classification are the tax base until the contrary is established (A.R.S. 42-5001 and 42-5023); neither names card surcharges. source Public record

What was checked: Checked: SB 1623 (2026, Second Regular Session), which would have added A.R.S. 44-7821 capping credit card interest at 15 percent and providing that a credit card merchant may not add a surcharge to any charge made with a credit card, enforced by the Attorney General; only the introduced version is on the Legislature's site (no Senate engrossed version was found), so it did not pass the Senate. A.R.S. 42-5001 and 42-5023 read for the tax base. One search of azdor.gov found no surcharge guidance. A full-text search of government sites (state code and agency pages) on 2026-11-05 found no seller surcharge provision.

Not confirmed: No full-text search of the A.R.S. (Title 44, trade and commerce) for "surcharge" was run; the finding of no statute rests on SB 1623 (2026), which would create a ban, and on not finding one. SB 1623 status not read on the Legislature's bill status page (apps.azleg.gov); the conclusion that it did not pass rests on the absence of any engrossed version at azleg.gov/legtext/57leg/2R/bills/. Department of Revenue position on transaction privilege tax for a card surcharge not found; ask ADOR or check its rulings index.

Federal law and the card networks' own rules apply in every state. Surcharge rules in every state

Pass-through entity tax

Checked Nov 3, 2026. Pass-Through Entity (PTE) election (Arizona PTE income tax)

A business treated as a partnership or S corporation for federal purposes may elect, on its Arizona Form 165 or 120S, to pay tax at 2.5 percent (2025) on the income of its individual, estate and trust owners who do not opt out after a notice giving them at least 60 days; other owners are left out. The department's 2025 forms say the election is due by the due date or extended due date of the return, but Publication 713 (November 2025) says S.B. 1274 of 2025 retroactively removed the timely filing requirement, so the election can be made or revoked on an amended return within the four-year statute of limitations. Participating owners claim a nonrefundable credit on Form 355 with Form 301, carried forward up to five years, and add back the PTE tax paid for them.

Law

A.R.S. section 43-1014 (election and tax) and section 43-1077 (owner credit). HB 2838 (named by the department as the bill that created the credit); first available for taxable years beginning from and after December 31, 2021. Amended by S.B. 1734 (2023 session) and S.B. 1274 (2025). First tax year 2022. source Public record

Who can elect

A business treated as a partnership or S corporation at the federal level, including an LLC that elects to be treated as either. A partnership share owned by a grantor trust disregarded for federal purposes, or by a single member LLC disregarded to an individual, may be included. Only partners or shareholders who are individuals, estates or trusts and who do not opt out participate. Corporations, partnerships and other non-individual owners, and owners who opt out, are not included, but they do not prevent the election; their income is left out of the PTE tax and credit. A lower-tier partnership or S corporation cannot pass the credit through to partners or shareholders that are other partnerships or S corporations. source Public record

Election

On the entity's Arizona return (Form 165 for partnerships, Form 120S for S corporations), answering Line A. Before electing, the entity must notify its individual, estate and trust owners and give each at least 60 days after receiving the notice to opt out; an owner who does not respond is included. The partnership or S corporation; each eligible owner may opt out. Deadline: The department's 2025 Form 165 and 120S pages say no later than the due date or extended due date of the return. Publication 713 (revised November 2025) says S.B. 1274 (2025) retroactively removed the timely filing requirement: the election may be made on an amended return filed before the four-year statute of limitations expires, with each participating owner also amending. Yes, by an amended return (Line A answered No) filed before the four-year statute of limitations expires; each participating owner must amend to remove the credit and add-back, and penalties and interest may apply. source Public record

Rate

2025: 2.5% Income attributable to participating resident partners or shareholders, plus income from Arizona sources attributable to participating nonresident partners or shareholders. A partnership starts from ordinary and rental income with Arizona additions and subtractions plus the separately computed items of A.R.S. 43-1412 paragraphs 1 to 16; an S corporation starts from all of its federal distributable income. source Public record

Estimated payments

Required if the electing entity's taxable income for the prior year exceeded $150,000: four payments, the required annual payment being the smaller of 90 percent of the current year's tax or 100 percent of the prior year's. Late or underpaid installments are penalized (Form 220/PTE). Pay by electronic funds transfer if the PTE tax is $500 or more; failing to do so carries a 5 percent penalty. 15th day of the 4th, 6th and 9th months of the taxable year and the 15th day of the 1st month after it ends (April 15, June 15, September 15 and January 15 for calendar years). source Public record

Return

Arizona Form 165 (partnership) or Form 120S (S corporation); credit passed to owners on Schedules K-1 and K-1(NR). Due 15th day of the 3rd month after the close of the taxable year (March 15 for calendar years). With a valid federal or Arizona extension, 6 months from the original due date. An electing entity must pay 90 percent of the tax by the original due date to avoid the extension underpayment penalty. source Public record

Owner credit

Owners enter the PTE credit on Form 355 and Form 301 (or 301-SBI) and claim it on their Arizona individual return (Form 140, 140PY, 140NR, 140X or the SBI versions); estates and trusts use Form 141AZ. The owner adds back the PTE tax paid on its behalf. No. Up to five taxable years. Nonresident participants receive Schedule K-1(NR) and must each file their own Arizona return to claim the credit; the entity cannot file a composite return for owners who did not opt out. Credit for other states' PTET: On Form 309 (credit for taxes paid to another state or country), a resident includes its pro rata share of tax an entity paid to another state on its behalf, limited to the lesser of the amount the entity paid or the other state's individual tax had the entity not elected. The department does not list the states. source Public record

Recent and coming changes

• S.B. 1274 (2025) retroactively removed the timely filing requirement: the election may be made, or revoked, on an amended return within the four-year statute of limitations. source Public record
• Jan 1, 2023 S.B. 1734 (2023 session) changed the starting point for an electing partnership's Arizona taxable income, for taxable years beginning from and after December 31, 2022. source Public record
• Publication 713 addresses entities that paid 2025 PTE estimates but decided not to elect after the federal SALT deduction limit rose from $10,000 to $40,000 in 2025: they file a return answering No on Line A to get the estimates refunded. source Public record

An entity that made PTE estimated payments for 2025 but does not elect must file a $0 Form 165 or 120S indicating it is not electing; the estimates are refunded and cannot be applied to 2026 or to an owner's tax. The department's 2025 form highlights still describe the due-date deadline that S.B. 1274 removed.

Not confirmed: 2026 rate not confirmed: the 2026 estimated tax booklet repeats the 2.5 percent rate only inside its 2025 highlights. Whether the election is annual is not stated in the sources read (it is made on each year's return). The year HB 2838 was enacted, the S.B. 1274 effective date and the statute text (A.R.S. 43-1014, 43-1077) were not read from a primary source; azleg.gov was not fetched.

Pass-through entity tax in every state

Conformity to the 2025 federal tax law

Checked Nov 3, 2026. Business tax: corporate income tax

Arizona follows the Internal Revenue Code as of a fixed date that the legislature moves forward each year (A.R.S. 43-105). H.B. 4168 (Laws 2026, chapter 140), signed June 13, 2026, moved the date to January 1, 2026 and, retroactively for 2025, adopted the Public Law 119-21 provisions effective in 2025, after the Governor vetoed an earlier conformity bill (S.B. 1106) on January 16, 2026. Because Arizona starts from federal adjusted gross income, the new law adds state subtractions for qualified tips, overtime and the senior deduction from 2025 and for car loan interest for 2025 only; Arizona follows bonus depreciation but from 2026 adds back the new section 168(n) allowance for qualified production property.

Follows the Code

Fixed date, Code as of Jan 1, 2026. A.R.S. 43-105, as amended by Laws 2026, chapter 140 (H.B. 4168), section 12
For taxable years beginning after December 31, 2025, the Code is the one in effect on January 1, 2026, including provisions that became effective during 2025, excluding later changes. For 2025, the Code is the one in effect on January 1, 2025 plus the provisions of Public Law 119-21 that are retroactively effective during 2025; chapter 140 similarly adds the Public Law 119-21 provisions retroactively effective in 2022, 2023 and 2024. Section 43-105 applies retroactively to taxable years beginning after December 31, 2024. Individual and corporate rules use the same definition. source Public record

Starting point

Individuals: federal adjusted gross income
Corporations: federal taxable income source Public record

Response to Public Law 119-21

Adopted. H.B. 4168, Laws 2026, chapter 140, signed June 13, 2026. Years: Taxable years beginning from and after December 31, 2024 (2025 and later), with some provisions from 2026
Chapter 140 conforms to the Code as of January 1, 2026 with all retroactive effective dates, adds individual subtractions for qualified tips, overtime and the senior deduction (2025 on) and car loan interest (2025 only), sets the standard deduction at $15,750, $23,625 and $31,500 for 2025, adds an addition for the section 168(n) qualified production property allowance from 2026, and limits the state and local tax itemized deduction to $10,000 from 2026. An earlier conformity bill, S.B. 1106, passed both chambers on January 15, 2026 and was vetoed on January 16, 2026. ADOR's 2025 forms, released before conformity passed, assumed conformity, and ADOR said taxpayers who later need to amend 2025 returns would not owe penalties or interest if they amend by October 15, 2027. source Public record

Provision by provision

Other differences

• Section 168(n) qualified production property: from 2026, the special depreciation allowance is an addition for individuals and corporations, to the extent not previously added. source Public record
• State and local tax deduction: from 2026, an itemizer may deduct up to $10,000 of state and local taxes in place of the full federal itemized deduction for those taxes. source Public record
• Charitable contributions: from 2026, a taxpayer taking the standard deduction may increase it by all of the year's charitable contributions, capped at $1,000 ($2,000 married filing jointly), instead of up to 25 percent of them. source Public record
• New subtractions from 2026 for distributions from a Trump account (section 530A) and for child and dependent care expenses that exceed the federal credit received. source Public record

Guidance from the state

• Jan 30, 2026 ADOR Outlines Guidance on 2025 Tax Year Income Tax Forms (revised release)
• Jan 22, 2026 ADOR Outlines Executive Order and 2025 Tax Year Income Tax Forms (superseded)
• Conformity to IRC (ADOR page; latest entry is 2024 conformity)
• Jun 23, 2026 Senate fact sheet for H.B. 4168/S.B. 1861, as enacted

Recent and coming changes

• Jan 1, 2025 Laws 2026, chapter 140 (H.B. 4168): Code date January 1, 2026; tips, overtime and senior subtractions from 2025; car loan subtraction for 2025; 2026 additions and deduction changes. 2025 returns filed on the original forms may need amending; ADOR said it would provide guidance and waive penalties and interest for amendments filed by October 15, 2027. source Public record

ADOR's 2025 Form 140 instructions predate chapter 140 and do not show the new subtractions. ADOR estimated standard conformity would reduce the General Fund by $369.88 million in FY 2026, $144.57 million in FY 2027 and $154.28 million in FY 2028 (Senate fact sheet).

Not confirmed: No ADOR guidance issued after chapter 140 (amended return instructions, revised 2025 forms, or 2026 forms) was found; the ADOR conformity page still ends with 2024. The statuses for sections 179, 174A and 163(j) rest on the statute's adoption of the Code and of Public Law 119-21's retroactive provisions; no ADOR statement on them was found. Chapter 140's sections 43-1121 and 43-1122 (corporate additions and subtractions) were read only for the bonus and section 168(n) items.

Conformity in every state

Pay in job postings

Checked Nov 2, 2026. No state pay range law

Arizona does not require employers to put pay in job postings or to disclose a pay range to applicants or employees. Its equal pay statute, A.R.S. 23-341, bars paying employees less than employees of the opposite sex for the same work but requires no disclosure, and no salary history ban was found in the statutes checked.

Salary history ban: No. No salary history provision was found in A.R.S. Title 23 (Labor), the equal wage statute A.R.S. 23-341 or the employment discrimination section A.R.S. 41-1463. source Public record

What was checked: Checked for a posting or disclosure law: the section list of A.R.S. Title 23 (Labor) on the Legislature's site, including chapter 2, article 6.1, Equal Wages (A.R.S. 23-340 and 23-341) and article 7, Payment of Wages, with no section on pay ranges, pay disclosure or job postings; A.R.S. 23-341 (equal wage rates, enforced by complaint to the Industrial Commission of Arizona or a civil action); and A.R.S. 41-1463 (unlawful employment practices). The Industrial Commission of Arizona's Labor Department pages could not be read (Cloudflare check). No city or county ordinance requiring pay in postings was found.

Not confirmed: Industrial Commission of Arizona Labor Department pages (https://www.azica.gov/labor-department and its FAQ) returned a Cloudflare check; they need a browser to confirm the agency describes no pay disclosure duty. A non-government article claims a 2023 bill, HB 2274, requires employers with 15 or more employees to disclose salary ranges. The Legislature's text of 2023 HB 2274 (56th Legislature, first regular session) is an income tax credits and subtractions bill, and no pay range section appears in A.R.S. Title 23; noted only so the claim is not picked up later. 2026 session bills were not searched bill by bill; city codes (for example Phoenix and Tucson) were not checked one by one.

Pay transparency rules in every state

For tax professionals

Checked Nov 3, 2026. Arizona Department of Revenue (ADOR)

ADOR's authorization is Arizona Form 285, General Disclosure/Representation Authorization Form (Form 285-I for individual income tax), which grants disclosure and, if Section 5 is checked, a power of attorney. ADOR accepts a federal Form 2848 or 8821 only if it is modified to address Arizona taxes (references to the IRS replaced with ADOR) and contains the required information. No paid preparer registration program was found, and a preparer who prepares more than ten original individual returns must e-file all individual returns, unless the taxpayer elects paper.

Power of attorney

Arizona Form 285, General Disclosure/Representation Authorization Form (ADOR 10952, 4/25); Form 285-I, Individual Income Tax Disclosure/Representation Authorization Form; Form 285B, Disclosure Authorization Form, for disclosure only. The appointee must be an individual. To represent in administrative matters: an active member of the State Bar of Arizona, an Arizona CPA, or a federally authorized tax practitioner (an enrolled agent; an out-of-state attorney or CPA who has filed the IRS declaration; or an individual practicing with such a practitioner under the same standards). Any individual may represent if the total in dispute is less than $5,000, and certain full-time officers, members, managers or employees may represent an entity. The tax types checked (more than one allowed) and the tax years or periods listed; "all years" means all years, open or closed, including future years. Signing alone authorizes disclosure; Section 4 adds specific powers and Section 5 grants a full power of attorney for the listed matters. Email POA@azdor.gov, fax (602) 716-6008, or mail to Arizona Department of Revenue, ATTN: Power of Attorney, PO Box 29086, Phoenix, AZ 85038-9086 (or directly to an ADOR employee who requested it). No renewal: valid until revoked. Checking Section 6 of a new Form 285 revokes all earlier authorizations except those listed. form source Public record

Federal Form 2848

Accepted with conditions General Tax Procedure GTP 18-1 accepts a federal Form 2848 if it has been modified to address Arizona taxes and contains all of the required information: the example lists the Arizona tax and years, grants the power of attorney in the other acts line, and replaces references to the IRS with AZDOR. A federal Form 8821 modified the same way is accepted for disclosure. source Public record

Information only

Form 285 without Sections 4 and 5 (disclosure only), Form 285B, Disclosure Authorization Form, or a modified federal Form 8821. Authorizes ADOR to release confidential information to the named appointee, without representation. source Public record

Preparer registration

No program found

Preparer ID on returns

A paid preparer must include an identification number where requested on Form 140: the PTIN, the preparer's SSN, or the EIN for the business. PTIN: accepted. Penalty: The Form 140 instructions say a paid preparer who fails to include the proper identification number may be subject to a penalty (amount not stated). source Public record

E-file mandate for preparers

More than ten original income tax returns timely filed during a taxable year beginning after December 31, 2017: the preparer must then e-file all individual returns for that year and each later year (A.R.S. 43-323(E)). Individual income tax returns. The preparer may not charge a separate fee for e-filing through the department's program. Separately, fiduciary, partnership, withholding and corporate returns must be e-filed for taxable years beginning after December 31, 2019 (A.R.S. 43-323(F)), with an annual waiver on Form 292, Electronic Filing and Payment Waiver Application. Client opt-out: No form found: the preparer mandate does not apply if the taxpayer elects to have the return filed on paper or if the return cannot be filed electronically for reasons outside the preparer's control. source Public record

Transcripts and account records

Paper request on Arizona Form 450, mailed with a check or money order to Arizona Department of Revenue, Copy Desk, PO Box 29216, Phoenix, AZ 85038-9216. Arizona Form 450, Request for Copies of Tax Documents (ADOR 10582). Who can ask: The taxpayer; anyone else must provide a power of attorney signed by the taxpayer. Copies of filed returns or other documents for individual income, corporate income, transaction privilege and use, withholding and other taxes, by tax period. No account transcript product was found. Fee: $5.00 per tax period uncertified; $7.00 per tax period certified. Turnaround: Allow ten days for processing after the Copy Desk receives the request. Online for representatives: No online copy or transcript request for representatives was found. request source Public record

Online access for professionals

AZTaxes.gov (delegate user access). Business account functions (such as transaction privilege tax and withholding filing and payment) for the accounts a delegate is given authority over. Each business account has one Primary User, recommended to be an officer or owner, who grants specific authority to Delegate Users such as a CPA or paid preparer. The preparer registers an AZTaxes account and requests delegate access; changing the Primary User needs a Business Account Update form. source Public record

Practitioner line

Tax Professional Dedicated Resource by email (AZTaxPractitionerHotline@azdor.gov) for specific and complex individual income, corporate income, withholding and TPT issues such as processing errors, misapplied payments and amended returns; a valid Form 285 must be on file or attached. General line Phoenix (602) 255-3381, toll-free (800) 352-4090 from area codes 520 and 928. source Public record

Recent and coming changes

• Apr 2025 Arizona Form 285 revised (ADOR 10952, 4/25) source Public record

The practitioner email address is Cloudflare-encoded on the ADOR page; the decoded address is AZTaxPractitionerHotline@azdor.gov. The Form 450 page lists a 2016 publish date.

Not confirmed: Penalty amount for failing to e-file under A.R.S. 43-323(E) and for omitting the preparer identification number: not found. Whether Arizona Form 140 has a preparer or third party discussion check-box: not found in the instructions read. Whether AZTaxes.gov now offers individual income tax account access or transcripts for representatives: not found. Processing time for Form 285: not stated. registration.required is false because no Arizona preparer registration or licensing program was found on ADOR's tax professional page; no statute was checked.

Rules for tax professionals in every state

Federal tax data sharing

17 IRS data-sharing agreements with agencies in Arizona, for any purpose (TIGTA, as of March 2026) source Public record; FUTA credit certified to the IRS by Arizona Department of Economic Security source Public record; the workforce agency signed the IRS Questionable Employment Tax Practices (QETP) agreement in 2007 source Public record; in the IRS State Reverse File Match pilot, 2007 to 2008 source Public record. How the IRS shares tax data with the states

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