Arizona State Income Tax for 2011, 2012

There are five brackets of Arizona State Income Tax: 2.87%, 3.20%, 3.74%, 4.72%, and 5.04%. An additional 2% is usually added by county and municipal sales tax as well. The transaction privilege tax for the state is 6.6%.

There is a county tax in all fifteen Arizona counties. For transient lodging (hotel/motel), the state tax rate is 7.27%. Foods intended for home consumption don’t have a state tax in Arizona, and drugs prescribed by a licensed physician or dentist also don’t have a state tax. Phoenix, however, does have a 2% tax on food for home consumption, as do a few other cities in Arizona.

There is no child tax credit provided in Arizona state tax laws, but there is a child tax exemption. To receive the child tax exemption, you’ll have to find Part A on the back of Form 140 Series.

Tax Burden

At 8.7%, Arizona’s state and local tax burden is below the national average of 9.8%. In 1977, Arizona’s state and local tax burden was at 10.3% and it was 18^th nationally. The state and local taxes for Arizona taxpayers come out to $3,140 per capita.

Arizona’s corporate tax structure has a flat rate of 6.968%. It’s the 26^th highest in the nation as far as corporate income taxes go. Corporate tax collections per capita came to $90 in 2009, which was the 34^th highest nationally.

The general sales tax in Arizona is 5.6%, only slightly lower than the national median of 5.85%. The combined state and local general and selective sales tax collections in 2007 amounted to $1800 per person, which was 7^th highest nationally.

Arizona Income Tax Credit

One of the Arizona tax credits is the working poor credit. If you’ve made contributions that provide assistance to the working poor, this tax credit is available to you.

Find Arizona tax forms and filing information here.