This bill proposes to amend current Arizona tax statutes by expanding the individual income tax subtraction for active service compensation. Under the current law, compensation received for active service is limited to members of the reserves, the National Guard, or the armed forces. The bill would update this language to include compensation for active service in the "uniformed services" of the United States, which encompasses the U.S. Armed Forces as well as the Public Health Service and the National Oceanic and Atmospheric Administration.

Additionally, the bill specifies that these changes would take effect for taxable years beginning after December 31, 2025. This means that starting January 1, 2026, individuals serving in the U.S. Uniformed Services would be eligible for the income tax subtraction, thereby broadening the scope of tax relief available to military personnel and their families.

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