What is State Income Tax?
State tax is a tax issued by a state on your income (what you earn within a tax year). State income taxes, which vary by state, and are either based on a percentage of your income, or imposed as a flat tax rate.
If you earn an income in Arizona, read up about Arizona taxes and your obligation to pay them – including how much you have to pay, when they’re due, and how to pay them.
Who Pays Arizona Income Tax?
Just like the federal government, residents pay Arizona state taxes on income or earnings if you have a sufficient connection to the state.
Arizona residents must file a state income tax return if they are:
- Single, married filing separately or head of household and the Arizona Adjusted Gross Income (AAGI) is at least $5,500, or the Gross Income (GI) is at least $15,000
- Married and filing jointly and the AAGI is at least $11,000, or the GI is at least $15,000
So, if you earn an income in Arizona, you must pay Arizona income taxes. For example, as a traditional W-2 employee, your Arizona state tax will be drawn on each payroll period automatically. You will see this on your paycheck, near or next to the federal taxes.
Income taxes aren’t the only taxes in Arizona. In fact, if you own property in Arizona, you are subject to Arizona property taxes. (Arizona property taxes on owner-occupied residences are levied based on the assessed value, not current market value.) Learn more about Arizona property taxes.
Arizona doesn’t impose an estate, inheritance, or gift tax.
How Do You Pay Arizona State Taxes?
The filing requirements are explained at the beginning of the instructions on all Arizona income tax returns. View the Arizona tax forms.
How Much Should You Pay in Arizona State Tax?
In Arizona, state income tax is imposed at a marginal rate. The lowest rate is 2.59%; the top rate is 4.54%. Read more about Arizona tax rates.
When Are Arizona Tax Returns Due?
The state tax deadlines coincide with the federal tax deadline, which typically is on April 15, unless it’s on a weekend or holiday or deemed otherwise by the IRS.
Check www.azdor.gov for updates to the current filing year.
How Do You Check If You Paid State Taxes?
To make sure your state taxes were paid, refer to the Arizona Department of Revenue.
Deducting Arizona State Income Taxes
If you pay Arizona income tax, you may be able to claim a deduction on your federal tax return for them if you itemize deductions on your federal return.
To determine if you should itemize your deductions, add up your calendar-year deductible expenses, including your state income tax expense, to be greater than the standard deduction amount for your filing status. Due to the Tax Cuts and Jobs Act, state and local tax deductions, including state income taxes, are limited to $10,000 per year.
More Help With Arizona Taxes
Understanding your tax obligation can be confusing. What’s even more confusing is how to deduct Arizona tax from your federal taxes as an itemized deduction.
So, get help with H&R Block Virtual! With this service, we’ll match you with a tax pro with Arizona tax expertise. Then, you will upload your tax documents, and our tax pros will do the rest! We can help with your AZ taxes, including federal deductions for paying state taxes.
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