The proposed bill amends section 43-1022 of the Arizona Revised Statutes to include a new provision regarding individual income tax. Specifically, it states that for taxable years starting after December 31, 2024, cash tips received by individuals, which are reported to their employers in accordance with federal law (26 U.S. Code section 6053), will be excluded from Arizona gross income, provided they are not already excluded under the internal revenue code.

This change introduces a new tax benefit for individuals receiving cash tips, allowing them to exclude this income from their state tax calculations, which is not currently addressed in the existing law. The amendment aims to align state tax treatment of cash tips with federal reporting requirements, potentially reducing the tax burden on individuals who rely on tips as a significant part of their income.

Statutes affected:
Introduced Version: 43-1022