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Arizona Employment Law Update – March 2017

March 13, 2017

Arizona

Withholding Reporting to Conform with the IRC Code

Under Arizona Senate Bill (S.B.) 1290, and effective July 7, 2017, the state conforms to the Internal Revenue Code (IRC) for corporate and personal income tax for taxable years beginning after 2016.

References to the IRC are updated to mean the IRC as amended and in effect on January 1, 2017, including those provisions that became effective during 2016, with the specific adoption of their retroactive effective dates. Previously, for purposes of computing Arizona corporate and personal income taxes for taxable years beginning after 2015, references to the IRC meant the IRC as amended and in effect on January 1, 2016, including those provisions that became effective during 2015, with the specific adoption of all federal retroactive effective dates.

Additionally, according to the legislation, a partnership that does not have Arizona income, deductions, or credits for a taxable year does not have to file a return for that year; employers are required to submit an annual return of withholding to the Department of Revenue by January 31 (currently, February 28) of each year; and the time within which an employer must submit an annual statement of withholding to each employee is extended to 31 days (currently, 30 days) after the end of each calendar year.

Read Arizona S.B. 1290

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