Disclaimer: This calculator gives you an estimate based on tax rates and details found online. These rates may change over time. For the most accurate and up-to-date information, please check the official IRS website and your state’s tax website. Always talk to a tax expert for advice about your personal tax situation.
How We Calculate the Result
In Arizona, calculating your income tax is simple because the state uses a flat income tax rate of 2.5% for all taxpayers, regardless of income level. This means whether you earn $30,000 or $300,000, the same percentage applies.
To find your taxable income, you start with your total household income. Then you subtract certain amounts like 401(k) contributions, IRA contributions, itemized deductions or standard deductions, and personal exemptions. Arizona’s standard deduction for a single person is $2,600, and $5,200 for married couples filing jointly. Each personal exemption counts as $250.
Once you get the taxable income after all deductions, you multiply it by 2.5% (0.025) to find how much Arizona state tax you owe. This calculator also compares your income with federal tax filing thresholds, which vary based on your age and filing status, to check if you need to file federal taxes too.
About Arizona Income Tax
Arizona applies a flat tax rate of 2.5% to all taxable income. This makes it one of the simplest state tax systems in the U.S., as everyone pays the same rate regardless of how much they earn.
In 2023, Arizona replaced its progressive tax brackets with a single flat rate, aiming to make the system easier and more predictable. The state also provides standard deductions ($2,600 for individuals and $5,200 for married couples), plus a small personal exemption of $250 per dependent. You can also deduct contributions to your retirement accounts like a 401(k) or IRA.
Arizona does not tax Social Security income, which is helpful for retirees. However, all other income — like wages, self-employment income, and rental income — is subject to the flat 2.5% rate.
Frequently Asked Questions
What is the income tax rate in Arizona?
Arizona has a flat income tax rate of 2.5%. This means everyone pays the same rate no matter how much they earn. After deducting allowable expenses like retirement contributions and exemptions, you apply the 2.5% rate to the remaining taxable income.
When do singles start paying Arizona income tax?
Single filers in Arizona start paying state income tax if their taxable income is above $2,600 after deductions. However, for federal filing purposes, single people under 65 must file if they earn $14,600 or more. Arizona uses a flat 2.5% tax rate.
When do married filers start paying Arizona Income tax?
Married couples filing jointly in Arizona start owing state income tax once their taxable income exceeds $5,200 after deductions. But for federal filing, they must file if their combined income is $29,200 or more (if both are under age 65). The state tax rate is 2.5%.
Are retirement contributions deductible in Arizona?
Yes, contributions to accounts like a 401(k) or traditional IRA are deductible in Arizona. These reduce your taxable income, which helps you pay less in taxes. The calculator includes options to enter your 401(k) and IRA contributions to estimate savings.
Does Arizona have tax exemptions?
Yes, Arizona offers personal exemptions of $250 per person, including dependents. This means you can subtract $250 for each qualifying person in your household from your income before calculating your 2.5% state tax.