Bill > HB2491

This bill modifies Arizona's corporate income tax laws concerning how businesses allocate their income, particularly for companies operating in multiple states. It adjusts the formulas used to determine the portion of a business's income that is taxable in Arizona, with a phased approach that gradually shifts the weighting towards sales within the state for certain types of income. For sales of services and intangible property, the bill introduces a new framework for determining where the "market" for those sales is located, with a significant change to take effect after December 31, 2026, where sales will be considered in Arizona if the taxpayer's market for those sales is in the state, with specific rules for various types of transactions like real estate, tangible property rentals, loans, investments, services, and intangible property. The bill also clarifies definitions and election procedures for multistate service providers, allowing them to choose how their sales are attributed to Arizona based on a combination of where the income-producing activity occurs and where the customer benefits from the service or intangible property, with a transition towards a market-based approach over several years.

Budget and Finance

https://apps.azleg.gov/BillStatus/BillOverview/84268