How To Calculate Arizona State Income Tax

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If you reside in Arizona, you are probably aware of the state income tax that you are required to pay each year. Due to the federal tax reform that occurred in December 2017, the state of Arizona changed their income tax brackets for the 2018 fiscal year. The following tax brackets will be used for taxes on income earned during 2018. You should use these figures to calculate your Arizona State income tax.

Arizona State Income Tax Brackets For Single Residents

Tax Bracket
$0.00+ – 2.59 percent
$10,179+ – 2.88 percent
$25,445+ – 3.36 percent
$50,890+ – 4.24 percent
$152,668 – 4.54 percent

If you’re a single resident in Arizona, there are five different tax brackets that you will need to look at to see how much you’ll have to pay for your Arizona State income tax. Each tax bracket represents a portion of your income. As your income goes higher, you use more tax brackets to figure your Arizona State income tax.

As an example, if your income is $66,500, you will use four of the tax brackets. Here’s how you calculate your Arizona income tax for $66,500:

((($10,179 x .0259 = $263.64) + ($15,266 x .0288 = $439.66) + ($25,445 x $854.95 = $854.95) + ($8565 x .0424 = $363.16)) = $1921.40)

This state income tax figure also took into consideration that you took the standard deduction of $4945, a personal exemption of $2100 and zero dependents.

Arizona State Income Tax Brackets For Married Residents Filing Jointly

Tax Bracket
$0.00+ – 2.59 percent
$20,357+ – 2.88 percent
$50,890+ – 3.36 percent
$101,779+ – 4.24 percent
$305,336+ – 4.54 percent

If you reside in Arizona and decide to file your taxes jointly with a spouse, you will have five different tax brackets to figure your taxable income. You should total both of your incomes together when figuring the amount that you will have to pay for your Arizona State income tax. Here’s an example if you are filing your taxes jointly and reside in Arizona.

Let’s say you make $$45,000 in 2018 and your spouse makes $35,000. You must combine both figures when determining how much Arizona income tax you will both have to pay. To do this you would take ($45,000 + $35,000 = $80,000) to come up with a final total income of $80,000 In this case, you’ll be using three tax brackets to determine your Arizona income tax. Here’s how you would calculate that figure:

(($20,357 x 0.259 = $527.25) + ($30,533 x 0.288 = $879.35) + ($15027 x 0.336 = $504.91) = $1911.50)

The state income tax figure was based off you claiming an exemption for yourself, an exemption for your spouse and zero dependents. This would equal $9883 as a standard deduction and personal exemptions of $4200 for the state of Arizona.

Arizona Tax Deductions

When you figure your state income tax for Arizona, use your adjusted gross income (AGI) after you have taken any deductions that you qualify for. These qualifying deductions may include any of the following:

– Exemptions for dependents
– Business expenses
– The Arizona standard deduction

You must remember that your situation will be unique. If you own a business, have dependents or decide not to use your standard deduction, your Arizona State income tax payment will reflect these differences.