ADOR Updates Guidance Regarding Income Tax Conformity

- Wednesday, June 19th, 2019

The Arizona Department of Revenue recently issued the following guidance for individual income taxpayers now that the Arizona legislature has determined the matter of conforming to the Internal Revenue Code (IRC).

Tax year 2018 

  • For tax year 2018, Arizona now conforms to the IRC.  This includes 2018 tax forms, which were prepared assuming conformity.
  • No action is required of taxpayers who have already filed; for taxpayers who have filed an extension, returns are still due on October 15, 2019.

Tax year 2019

Beginning in 2020, Arizona individual income tax returns for tax year 2019 will include the following adjustments:

  • Match the federal standard deduction amount ($12,200 single/married filing separate, $18,350 head of household, $24,400 married filing joint)
  • Remove Arizona personal and dependent exemption amounts.
  • Provide $100 child tax credit per dependent under 17 years of age and $25 for dependents 17 and older.  The credit is phased out for federal adjusted gross income (FAGI) greater than $200,000 single/married filing separate and head of household, $400,000 married filing joint.
  • Allow taxpayers to increase standard deduction by 25 percent of the charitable donations that would have been claimed as an itemized deduction.

The changes also establish four tax brackets from the previous five tax brackets, with overall slight decreases to the rates for most tax brackets.

If you any questions, please contact our office.