State SealARIZONA HOUSE OF REPRESENTATIVES

 

HB 2528: capital gains; income tax subtraction

PRIME SPONSOR: Representative Mesnard, LD 17

BILL STATUS: House Engrossed

          

Legend: Amendments – BOLD and Stricken (Committee)

Abstract

☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal NoteRelating to the income tax deduction for capital gains.

Provisions

1.       Increases the tax deduction for any net long-term capital gain included in federal adjusted gross income that is derived from an investment in an asset acquired after December 31, 2017, as follows:

a.       From 25% of the capital gain included in federal adjusted gross income to 30% in TY 2019;

b.       35% in TY 2020;

c.        40% in TY 2021;

d.       45% in TY 2022; and

e.       50% in TY 2023. (Sec. 1)

2.       Specifies any asset acquired by gift or the death of a transferor is considered to have been acquired when the asset was originally acquired by the transferor.

a.       If the transfer date cannot be verified, no deduction is authorized.

3.       Makes conforming changes. (Sec. 1-2)

Current Law

A.R.S. § 43-1001 states that Arizona gross income is equal to the federal adjusted gross income for the taxable year and Arizona adjusted gross income is an individual's Arizona gross income modified by any statutory additions or subtractions. A.R.S § 43-1022 allows a deduction from Arizona gross income for any net long-term capital gain included in federal adjusted gross income, derived from an investment of an asset acquired after December 31, 2011. In TY 2017, a taxpayer may deduct 25% of any net long-term capital gain included in federal adjusted gross income.

 

 

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Fifty-third Legislature                  HB 2528

Second Regular Session                               Version 3: House Engrossed

 

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