Arizona Tax Changes

Arizona Senate Bill 1529 conforms to the Internal Revenue Code in effect on January 1, 2005 including those provisions that became effective during 2004 and adopts the retroactive dates of all retroactive provisions. The bill conforms to the effective date of the Federal changes and includes the following:

Educators' Deduction
Clean Fuel Vehicle Deduction
Sales Tax Deduction
Sale of Personal Residence Acquired in a Like-kind Exchange
Deduction for Discrimination Suit Costs

See Federal Tax Changes for additional explanation.

In addition, the Bill also changed the following provisions that only affected Arizona Tax law.

The standard deduction will be inflation indexed beginning January 1, 2005
The bill increases the maximum credits allowed to married taxpayers to twice the amount allowed for a single or head of household taxpayer for the following credits:
- Contribution to charities that provide assistance to working poor credits are increased to $300 for 2005 and $400 for 2006 and later years
- Contribution to school tuition organizations credits increases to $825 for 2005 and $1000 for 2006 and later years
- Contribution to public school for extracurricular activities credit increased to $300 for 2005 and $400 for 2006 and later years