The bill SB1413 proposes an amendment to the Arizona Revised Statutes regarding the individual income tax subtraction for active service compensation. Currently, the law allows members of the Reserves, the National Guard, or the Armed Forces of the United States to subtract compensation received for active service, including combat zone service, from their Arizona gross income. The new bill seeks to expand this subtraction to include compensation received for active service in the U.S. Uniformed Services, which encompasses a broader range of service branches beyond the Armed Forces.

The bill specifies that this amendment would become effective for taxable years beginning after December 31, 2024. If enacted, this change could potentially impact individual income tax collections and, consequently, the state General Fund, by allowing more individuals to subtract their active service compensation from their taxable income.

Statutes affected:
Introduced Version: 43-1022
Senate Engrossed Version: 43-1022