REFERENCE TITLE: income tax; rebate; seniors

State of Arizona

Senate

Fifty-sixth Legislature

Second Regular Session

2024

SB 1148

Introduced by

Senators Kern: Hoffman, Mesnard, Rogers, Wadsack;  Representatives Chaplik, Heap, Hendrix, Jones, McGarr, Pingerelli, Smith

An Act

providing for an individual income tax general welfare rebate.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Individual income tax general welfare rebate; eligibility; claim application; subtraction from Arizona gross income; appeal; report; legislative findings; delayed repeal; definitions

A. The department of revenue shall issue a onetime individual income tax general welfare rebate to an Arizona taxpayer who filed a full-year resident tax return for taxable year 2022, was fifty-five years of age or older during taxable year 2022 and who meets one of the following qualifications:

1. Had a tax liability of at least $1 on the filed full-year resident tax return for taxable year 2022.

2. If the taxpayer does not meet the tax liability requirement for taxable year 2022, filed a full-year resident tax return for taxable year 2021 under the identical filing status used on the taxpayer's taxable year 2022 full-year resident tax return and had a tax liability of at least $1 on the full-year resident tax return for taxable year 2021.

3. If the taxpayer does not meet the tax liability requirement for taxable year 2022 or 2021, filed a full-year resident tax return for taxable year 2020 under the identical filing status used on the taxpayer's full-year resident tax returns for taxable years 2021 and 2022 and had a tax liability of at least $1 on the full-year resident tax return for taxable year 2020.

B. If the taxpayer does not meet any of the requirements in subsection A of this section, the department of revenue shall conclude that the taxpayer does not meet the criteria to be issued a rebate under this section.

C. One rebate will be issued for each full-year resident tax return for taxable year 2022 that qualifies under subsection A of this section. The primary taxpayer's taxpayer identification number as reported on the taxpayer's full-year resident tax return for taxable year 2022 shall be used as needed in subsection A of this section for matching and verification purposes.

D. The department of revenue shall issue to a qualifying taxpayer a rebate of $____. For a married couple filing a joint return where only one spouse is fifty-five years of age or older, a rebate will be only issued for that spouse.

E. If a qualifying taxpayer is deceased, the taxpayer's surviving spouse, personal representative or executor or another official representative of the estate designated pursuant to applicable state law may receive the rebate for the deceased taxpayer.

F. The department of revenue shall pay all rebates issued pursuant to this section on or before November 15, 2024 but not earlier than October 15, 2024. The department shall attempt to pay a qualifying taxpayer's rebate by electronic funds transfer using the routing and account information provided by the taxpayer on the taxpayer's full-year resident tax return for taxable year 2022 or more recent routing and account information provided by the taxpayer. If such attempt fails, or if the taxpayer did not provide such routing and account information, the department shall issue the rebate check by mail to the most recent home address provided by the taxpayer. Any notification from the department that relates to the rebate issued under this section shall state the following:  "This rebate is being issued pursuant to Senate Bill ______, as passed by the fifty-sixth legislature, second regular session, and signed into law by the governor."  Any communication issued relating to the rebate issued under this section may not be sent from the governor's office, be sent on the governor's letterhead or reference the governor's office.

G. A taxpayer who does not receive the rebate issued pursuant to this section on or before November 15, 2025 may claim the rebate by filing a claim application online in the form and manner prescribed by the department of revenue.  The claim application must include the claimant's name, address, taxpayer identification number and individual income tax filing status.  The department shall review each claim application and verify the information provided. The department may request that a claimant provide evidence to verify the claimant's eligibility for the rebate.

H. In computing Arizona adjusted gross income, any rebate received by a taxpayer pursuant to this section and required to be included in Arizona gross income under the internal revenue code shall be subtracted from the taxpayer's Arizona gross income.

I. Notwithstanding any other administrative proceedings established by law or by rule, all appealable agency actions as defined in section 41-1092, Arizona Revised Statutes, and contested cases as defined in section 41-1001, Arizona Revised Statutes, relating to a rebate issued pursuant to this section are governed by title 41, chapter 6, article 10, Arizona Revised Statutes.

J. On or before February 15, 2026, the director of the department of revenue shall report the following information to the president of the senate, the speaker of the house of representatives and the director of the joint legislative budget committee:

1. The total dollar amount of rebates paid under this section.

2. The administrative costs associated with the department's program for issuing the rebates under this section.

3. The total number of tax rebates issued.

K. The legislature finds that:

1. Inflation is at a forty-year high, putting gas, groceries and other necessities out of reach for many Arizonans.

2. Responsible budgeting has allowed this state to take action to mitigate the harmful impacts of inflation by returning a portion of the surplus to this state's taxpayers who are fifty-five years of age or older.

L. This section is repealed from and after December 31, 2030.

M. For the purposes of this section:

1. "Arizona small business taxable income" has the same meaning prescribed in section 43-1701, Arizona Revised Statutes.

2. "Arizona small business tax liability" means an Arizona small business taxpayer's Arizona small business taxable income multiplied by the Arizona small business' applicable tax rate as prescribed by section 43-1711, Arizona Revised Statutes, plus any amount of recaptured Arizona small business income tax credits, minus any nonrefundable and refundable Arizona small business income tax credits claimed by the Arizona small business taxpayer under title 43, chapter 17, article 5, Arizona Revised Statutes.

3. "Taxable income" has the same meaning prescribed in section 43-1001, Arizona Revised Statutes.

4. "Tax liability" means the taxpayer's taxable income multiplied by the taxpayer's applicable tax rate as prescribed in section 43-1011, Arizona Revised Statutes, plus any amount of recaptured income tax credits and the taxpayer's Arizona small business tax liability, if any, minus the sum of nonrefundable and refundable income tax credits claimed by the taxpayer under title 43, chapter 10, article 5, Arizona Revised Statutes.