Arizona Taxes

What Makes Arizona Attractive – Arizona Taxes Are Low

 Arizona Taxes Put The State In Kiplinger’s Top Ten Most Tax Friendly States In U.S.

arizona taxes state in top temWith low state tax rates, Arizona taxes put it on Kiplinger’s top ten list of tax friendly states. Whether you are working or retired, low Arizona taxes will help you save money. Living in Arizona is great. Low taxes make it even better.

Here is the run down on Arizona Taxes

 Arizona Taxes – Sales Tax

The Arizona state sales tax is 5.6%. But counties and cities can, and do, add to that rate. The average combined levy for sales taxes in Arizona is about 8%.

Arizona does not tax food for home consumption. Drugs prescribed by a licensed physician or dentist aren’t taxes either. But once again, many cities in Arizona do.

 Arizona Taxes – Income Tax

The lowest Arizona income tax rate is 2.59%. That rate applies on taxable income up to $20,000 for married joint filers and up to $10,000 for other filers

On the high end, the rate is 4.54%. The rate applies on taxable income of $300,000 or more for married joint filers. For other filers, the rate applies for more than $150,000 taxable income.

 Arizona Taxes – Social Security

Arizona taxes are not applied to social security benefits. This is one of the many reasons people retire to Arizona. Great weather, lots of things to do and NO taxes on their social security.

 Arizona Taxes – Exemptions for Other Retirement Income

– Public Pensions

Railroad Retirement benefits are exempt. $2,500 of military, civil-service, and Arizona state and local government pensions are exempt. All out-of-state government pensions are taxable.

IRAs

Taxable at ordinary income rates.

401(k)s and Other Defined-Contribution Employer Retirement Plans

Taxable at ordinary income rates.

– Private Pensions

Taxable at ordinary income rates.

 Arizona Taxes – Property Taxes

Compared to many other states, Arizona’s property taxes are favorable. Median property tax on Arizona’s median home value of $166,000 is $1,321. (per the Tax Foundation)

Seniors may be eligible for property tax credits. Married couples 65 and older that earn $5,500 or less receive a property tax credit. Single home owners 65 and older earning $3,750 or less also receive a tax credit.

For homeowners at least 70 years old, may defer their property taxes. Several conditions apply

  1. They have been in the primary home for at least 6 years – OR
  2. Lived in the State of Arizona for at least 10 years – AND
  3. Do not receive more than $10,000 of taxable income per year.

Higher income seniors receive benefits as well. For those 65 and older who have been in their home for a least two years AND

  1. One owner of a property must have total income (for 2014) of $34,608 or less OR
  2. Married home owners must have total income of $43,260 or less

can have their property valuation frozen for three years.

The request must made to the assessor by September 1 to have the valuation frozen for the three year period. After three year a new request may be filed.

Arizona Taxes – Inheritance and Estate Taxes

There is no inheritance tax or estate tax.

Conclusion

Arizona is a great place to live. Great weather, an incredible list of things to do and low Arizona taxes will save you money. Whether you are working, retired or getting ready to be retired, consider Arizona. And especially Tucson AZ.

If you are considering a move to the Tucson AZ area on other southern Arizona community, we can help.

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Arizona Taxes was last modified: June 1st, 2016 by ben4wp

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Arizona Taxes was last modified: June 1st, 2016 by ben4wp
Arizona Taxes was last modified: June 1st, 2016 by ben4wp

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