Official Summary Text
HB2273 - 572R - Senate Fact Sheet
Assigned to
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COMMITTEE
ARIZONA STATE SENATE
Fifty-Seventh
Legislature, Second Regular Session
FACT SHEET FOR
H.B. 2273
distributions;
transportation projects; Pinal county
(
NOW: income tax
rebate; net revenues
)
Purpose
Establishes a
onetime individual income tax rebate for Arizona taxpayers whose primary
residence was located in Pinal County during TYs 2018 through 2024. Requires
the Arizona Department of Revenue (ADOR) to pay the rebates between October 15,
2027, and November 15, 2027, from the monies remaining in the escrow account managed
by the Pinal Regional Transportation Authority. Prescribes the rebate amount
and administrative procedures.
Background
In 2017, Pinal
County voters approved a transportation excise tax that became effective April
1, 2018. In 2022, the Arizona Supreme Court held that the Pinal Regional
Transportation Authority and the Pinal County Board of Supervisors acted
unlawfully when they adopted a two-tiered retail transaction privilege tax on
tangible personal property as part of the Pinal County transportation excise
tax. Between 2018 and 2024, ADOR collected nearly $87 million in excise tax revenues,
which the Pinal County Regional Transportation Authority deposited into an
interest-bearing escrow account (
Vangilder
v. Arizona Department of Revenue
, 252 Ariz. 481 (2022)).
In March 2024,
Pinal County, the Pinal Regional Transportation Authority and ADOR entered into
a memorandum of understanding (MOU) to refund the excise tax revenues to business
taxpayers that paid the excise tax. Eligible businesses have until April 9,
2026, to submit a request to Pinal County for a refund of monies paid plus
applicable interest (
ADOR
;
OAG
).
There is no
anticipated fiscal impact to the state General Fund associated with this
legislation.
1.
Requires ADOR, between October 15, 2027, and November 15, 2027, to issue
a onetime $300 individual income tax rebate to an Arizona taxpayer whose
primary residence was located in Pinal County during TYs 2018 through 2024 and
who filed a full-year resident tax return for TY 2026.
2.
Requires ADOR to enter into an MOU
with Pinal County and the Pinal Regional Transportation
Authority to pay
the rebates from the monies, including earned interest, remaining in the escrow
account in which the monies are being held.
3.
Requires ADOR to attempt to pay each rebate by electronic funds transfer
using the taxpayer's provided routing and account information or, if
unsuccessful, to issue the rebate check by mail to the most recent home address
provided by the taxpayer.
4.
Allows a taxpayer who does not receive the rebate by November 15, 2027,
to claim the rebate by filing an online claim application in a form and manner
prescribed by ADOR and requires the claim application to include the claimant's
name, address, taxpayer identification number and individual income tax filing
status.
5.
Requires ADOR to review each claim application and verify the
information provided and allows ADOR to request that a claimant provide
evidence to verify rebate eligibility.
6.
Allows a deceased taxpayer's surviving spouse, personal representative
or executor or another official estate representative to receive the rebate for
the deceased taxpayer.
7.
Requires a taxpayer, in computing Arizona adjusted gross income, to
subtract from the taxpayer's Arizona gross income any rebate amount received by
the taxpayer that is required to be included in Arizona gross income under the
U.S. Internal Revenue Code.
8.
Specifies that ADOR must conclude that a taxpayer does not meet the
rebate eligibility criteria, if the taxpayer does not meet any of the rebate
eligibility requirements.
9.
Directs ADOR to use a taxpayer's taxpayer identification number, as
reported on the taxpayer's TY 2026 tax return, for necessary matching and
verification purposes.
10.
Subjects
any appealable agency actions or contested cases relating to the rebate to
uniform administrative hearing procedures.
11.
Repeals
the Pinal County income tax rebate on January 1, 2033.
12.
Becomes
effective on the general effective date.
House Action
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Prepared by Senate Research
March 5, 2026
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Current Bill Text
Read the full stored bill text
HB2273 - 572R - H Ver
House Engrossed
distributions;
transportation projects; Pinal county
(now: income tax
rebate; net revenues)
State of Arizona
House of Representatives
Fifty-seventh Legislature
Second Regular Session
2026
HOUSE BILL 2273
AN
ACT
Distribution of income tax rebates.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1.
Individual
income tax rebate; eligibility; claim application; subtraction from Arizona
gross income; appeal; memorandum of understanding; delayed repeal
A. The department of
revenue shall issue a onetime individual income tax rebate to an Arizona
taxpayer whose primary residence was located in Pinal county during taxable
years 2018 through 2024 and who filed a
full-year
resident tax return for taxable year 202
6.
B. If the taxpayer does not
meet any of the requirements in subsection A of this section, the department of
revenue shall conclude that the taxpayer does not meet the criteria to be
issued a rebate under this section.
C. One rebate will be issued
for each full-year resident tax return for taxable year 2026 who
qualifies under subsection A of this section in the amount of $300. The primary
taxpayer's taxpayer identification number as reported on the taxpayer's
full-year resident tax return for taxable year 2026 shall be used as needed in
subsection A of this section for matching and verification purposes.
D. If a qualifying taxpayer
is deceased, the taxpayer's surviving spouse, personal representative or
executor or another official representative of the estate designated pursuant
to applicable state law may receive the rebate for the deceased taxpayer.
E. The department of
revenue shall pay all rebates issued pursuant to this section on or before
November 15, 2027, but not earlier than October 15, 2027. The
department shall attempt to pay a qualifying taxpayer's rebate by electronic
funds transfer using the routing and account information provided by the
taxpayer on the taxpayer's full-year resident tax return for taxable year
2026 or more recent routing and account information provided by the taxpayer.
If such attempt fails, or if the taxpayer did not provide such routing and
account information, the department shall issue the rebate check by mail to the
most recent home address provided by the taxpayer.
F. A taxpayer who does not
receive the rebate issued pursuant to this section on or before November 15,
2027 may claim the rebate by filing a claim application online in the form and
manner prescribed by the department of revenue. The claim application must
include the claimant's name, address, taxpayer identification number and
individual income tax filing status. The department shall review
each claim application and verify the information provided. The
department may request that a claimant provide evidence to verify the
claimant's eligibility for the rebate.
G. In computing Arizona
adjusted gross income, any rebate received by a taxpayer pursuant to this
section and required to be included in Arizona gross income under the internal
revenue code shall be subtracted from the taxpayer's Arizona gross income.
H. Notwithstanding any
other administrative proceedings established by law or by rule, all appealable
agency actions as defined in section 41-1092, Arizona Revised Statutes,
and contested cases as defined in section 41-1001, Arizona Revised
Statutes, relating to a rebate issued pursuant to this section are governed by
title 41, chapter 6, article 10, Arizona Revised Statutes.
I. The department of
revenue shall enter into a memorandum of understanding with Pinal county and
the Pinal regional transportation authority to pay the rebates allowed under
this section from the monies, including the interest earned on those monies,
remaining in the escrow account in which the monies are being held.
J. This section is repealed
from and after December 31, 2032.