If you are preparing to file an income tax return in Arizona, you'll want to know what forms you need, where and how to file them and how much you can expect to be taxed. While recently passed tax reforms will flatten Arizona's state income tax by 2023, in 2021, Arizona still has a graduated-rate income tax, ranging from 2.59 to 4.5 percent.
Visit the Individual Income Tax Highlights for 2021 page on the Arizona Department of Revenue (ADOR) website to view up-to-date information about the upcoming tax season.
Who Must File Arizona Income Taxes?
Whether you are a full-time or part-year resident of the state, you must file a state tax return in Arizona if your gross income exceeds a certain amount for your filing status:
- $12,550 if filing single or married filing separately
- $18,800 if filing as the head of household
- $25,100 if married and filing jointly
Full-year Arizona residents are taxed on all income including earnings or retirement income from another state. The state of Arizona taxes the same income sources that the Internal Revenue Service (IRS) subjects to federal taxes.
If you are a part-time resident or living in Arizona temporarily, you must file for the part of the year that you were an Arizona resident. If you earned income within Arizona before moving from the state, you are subject to Arizona tax on those earnings.
If you also pay income tax in another state, you won't pay double taxes on the same income earned. Nonresidents and partial residents can earn credit against their Arizona income taxes.
What Are the Forms to Use?
- filing status
- taxable income
- deductions: standard or itemized
- tax credits
- adjustments to income
- charitable donations
- claiming of estimated tax payments
For instance, if you are a full-year resident and single or filing jointly without dependents and with taxable income under $50,000 and you aren't itemizing deductions or claiming exemptions, you will use Arizona tax Form 140EZ.
If your income is above $50,000 or you are itemizing deductions, you must file Form 140. If your income is under $50,000, but you fit a very specific set of criteria, you file Form 140A. Nonresidents use Form 140NR, while part-year residents of Arizona will file Form 140PY.
You can find complete instructions and fillable forms on the ADOR website.
What Is the Tax Rate in Arizona?
An individual's income tax rate in Arizona is determined by five individual income tax brackets, depending on how much taxable income you make and how you file:
- 2.59 percent for singles in the $0 and $27,808 range or those filing joint/head of household in the $0 to $55,615 range
- 3.34 percent for singles in the $27,809 to $55,615 range or those filing joint/head of household in the $55,616 to $111,229 range
- 4.17 percent for singles in the $55,616 to $166,843 range or those filing joint/head of household in the $111,230 to $333,684 range
- 4.50 percent for singles in the $166,844 to $250,000 range or those filing joint/head of household in the $333,685 to $500,000 range
- 8.00 percent due to an extra 3.5 percent tax for singles over $250,000 or those filing joint/head of household over $500,000
What Are the Filing Deadlines and Extension Process?
Individual Arizona state income tax returns are typically due by midnight April 15, which falls on a day observed as a holiday for many taxpayers this year, so returns are due by Monday, April 18, 2022.
To file an extension, use Form 204 and postmark it on or before Monday, April 18, 2022. The due date for filing under a valid extension is October 15, which falls on a Saturday this year. Therefore, Monday, October 17, 2022, is on time.
What Are the Penalties for Late Filing and Underpayment of Taxes?
If your tax return is not received by the deadline, your late filing penalty will be 4.5 percent of the tax required for each month or partial month that the return is late.
For example, if you owe the ADOR $1,000 in taxes and don't file by the due date, you'll be penalized $45 for each month the return is late. The late fee is capped at 25 percent of your taxes owed, so in this case, the maximum penalty is $250.
However, that's just if the return is late. If the payment is late, you will face an additional penalty of 0.5 percent of the unpaid tax each month or a fraction of a month it remains unpaid.
If your tax is underpaid, you will need to submit Arizona Form 221 to calculate the penalty amount. If your tax goes unpaid, you will be charged the federal interest on the unpaid tax from the date the return is submitted until the debt is paid.
Where Do I Mail/E-file My Arizona Return?
Submitting your Arizona tax return through the e-file process is free and convenient.
To submit your return electronically, prepare your return through tax software at the same time you prepare your federal tax return. You will need to enter a bank account or savings account number so your return can be automatically transferred or your tax payment can be automatically withdrawn.
The tax preparation software will deliver acknowledgment to you when ADOR receives your completed tax return.
If you submit paper documents through the mail, you will need to have your tax returns postmarked and mailed to the ADOR by the due date. There are three different mailing addresses, depending on whether you are expecting a refund, sending a payment or mailing a return with a barcode.
How Do I Pay Taxes Due?
With electronic filing, you can choose to have your payment withdrawn from your bank account, set a date for electronic withdrawal or mail in a check. If you e-file, you will generate a payment voucher through the tax preparation software and mail that with a check to ADOR. Mail to: Arizona Department of Revenue, P.O. Box 29085, Phoenix, AZ 85038-9085.
If you are filing by mail and have taxes due, make your check payable to the Arizona Department of Revenue at the address listed for receiving payments: P.O. Box 52016, Phoenix, AZ 85072. If you mail your return without a check, you can also pay by credit card on aztaxes.gov.
However you file, make sure any taxes due are received by the April 18, 2022 deadline to avoid penalties. If you need to request a payment plan, you may do so through the State of Arizona Department of Revenue.
Where Can I Check My Arizona Refund Status?
Visit Where's My Refund on the State of Arizona Department of Revenue page to check your refund status. The Arizona Department of Revenue begins processing state returns in mid-February after federal income tax returns are processed.
The website does not provide specific timeframes for processing returns, so check Where's My Refund for the most up-to-date information about the status of your return. If you e-filed, your return will be a direct deposit to the account you specified.
What About Arizona Taxes if You're Self-employed?
If you are self-employed, you'll pay Arizona State income tax on any money you paid to yourself through your personal income tax return, depending on how your business is set up. Check with your tax preparation professional and aztaxes.gov for specifics.
What About Arizona Taxes if You're a Business?
In 2021, the corporate business tax rate is 4.9 percent. Everything you need to set up your business-user account is on the State of Arizona Department of Revenue website.
Rates and dates in this article are correct as of publication. But check for any changes with the Arizona Department of Revenue before you file.
- Tax Foundation.org - Arizona Legislators Consider Lower, Flatter Income Tax
- Arizona Department of Revenue - Filing Individual Returns
- Arizona Department of Revenue: Individual Income Tax Payment Tutorial
- Arizona State Retirement System: Tax Information
- Arizona Department of Revenue: 2021 Tax Tables
- Arizona Department of Revenue: Individual Income Tax Hightlights
- Arizona Department of Revenue: Which Tax Form Should I Use?
- Arizona Small Business Association - Self-Employment Tax
Melissa is a writer and editor from Chicago, with a background in small business ownership. After selling her business, she moved into marketing for nonprofits and now manages volunteers at a large medical association. She is a writing and editing contractor and contributed to dozens of blogs and websites.