The proposed bill would update current Arizona statutes by extending the authorized purposes for which public schools can utilize contributions from the Public School Extracurricular Activity Fees Tax Credit until June 30, 2029, and increasing the business personal property tax exemption to $500,000 effective January 1, 2026. It would also exempt the property of veterans with a 100% service-connected disability from the full amount of property tax, allowing their surviving spouses to maintain this exemption under certain conditions. Additionally, the bill would increase the individual income tax subtraction for unreimbursed adoption expenses and expand the transaction privilege tax (TPT) deduction to include larger pipes used for wastewater transport.

Moreover, the bill would remove the previous cap on property tax exemptions for veterans and eliminate the requirement for their property to be valued below a certain assessment limit to qualify for the exemption. It would also exclude all veterans' pensions from the income calculation for the exemption income cap. Other updates include expanding the definition of taxable property to include "wastewater," establishing a full property tax exemption for veterans with a 100% service-connected disability, and increasing the maximum exemption amount for personal property used for agricultural purposes. These changes aim to enhance tax benefits for veterans, support families adopting children, and provide additional funding flexibility for public schools while modernizing Arizona's tax code.

Statutes affected:
Introduced Version: 42-11127, 43-1089.01, 42-12002, 42-12001
Senate Engrossed Version: 42-5061, 42-5159, 42-11111, 42-11127, 43-1022, 43-1089.01, 42-5156, 23-501, 36-1901, 28-5201, 42-5074, 42-6017, 88-525, 95-627, 99-661, 111-296, 28-5739, 28-8344, 42-5001, 42-5075, 42-5009, 28-2154, 28-2154.01, 42-5073, 3-311, 46-191, 36-551, 41-3201, 41-1514.02, 1-215, 49-426, 49-480, 41-1516, 44-1771, 42-5014, 42-5063, 45-604, 28-1171, 104-104, 41-1519, 44-1302, 42-5064, 42-5029, 42-5032.01, 28-4301, 41-1520, 42-11152, 32-1601, 42-12002, 42-12001, 43-1023, 15-1628, 15-1451, 43-1333, 43-1025, 43-1027, 43-1029, 43-1021, 111-5, 111-92, 41-1518, 43-1042, 20-1691, 101-336, 43-1024, 43-1028
Chaptered Version: 42-5061, 42-5159, 42-11111, 42-11127, 43-1022, 43-1089.01, 42-5156, 23-501, 36-1901, 28-5201, 42-5074, 42-6017, 88-525, 95-627, 99-661, 111-296, 28-5739, 28-8344, 42-5001, 42-5075, 42-5009, 28-2154, 28-2154.01, 42-5073, 3-311, 46-191, 36-551, 41-3201, 41-1514.02, 1-215, 49-426, 49-480, 41-1516, 44-1771, 42-5014, 42-5063, 45-604, 28-1171, 104-104, 41-1519, 44-1302, 42-5064, 42-5029, 42-5032.01, 28-4301, 41-1520, 42-11152, 32-1601, 42-12002, 42-12001, 43-1023, 15-1628, 15-1451, 43-1333, 43-1025, 43-1027, 43-1029, 43-1021, 111-5, 111-92, 41-1518, 43-1042, 20-1691, 101-336, 43-1024, 43-1028