On July 9, 2021 Governor Ducey signed into law Senate Bill 1783 establishing Title 43 Chapter 17 (Small Businesses, which provides for an alternative tax for Arizona small business income. Beginning with tax year 2021, a taxpayer may elect to file a separate small business income tax return (Form 140-SBI, 140NR-SBI or 140PY-SBI) to report the their share of Arizona small business gross income.
The SBI tax return must be filed with the regular income tax return to be accepted. If the taxpayer does not file both returns together, the election may be denied and the adjustment to federal adjusted gross income may be disallowed.
The same taxpayer information and address is required on both Form 140 and Form 140-SBI to be validated and processed.
File Form 140 and Form 140-SBI with the same filing status. If filing married filing separate returns, enter the name and social security number of the spouse. If filing married filing joint returns, include all income.