This bill proposes to amend section 43-407 of the Arizona Revised Statutes, specifically regarding the treatment of unemployment compensation payments for tax withholding purposes. Under current law, any unemployment compensation payment to an individual who has elected to have state income tax withheld is treated as a payment of wages by an employer to an employee for a payroll period, with a withholding rate of ten percent of federal income tax deducted and withheld.

The bill would insert new language clarifying the treatment of these payments while removing the specific mention of the withholding rate. The deletion of the phrase regarding the ten percent withholding rate indicates a shift towards potentially allowing for more flexibility in how taxes are withheld from unemployment compensation, although the exact implications of this change would depend on further legislative or regulatory guidance.

Statutes affected:
Introduced Version: 43-407