Arizona Families Tax Rebate

A rebate is simply a return payment from the government to a taxpayer.

The Arizona Department of Revenue is pleased to inform you that, as a result of Governor Hobbs’ 2023 bipartisan budget, you may be eligible for a one-time Arizona Families Tax Rebate if you meet the requirements. This rebate is being issued pursuant to Senate Bill 1734, as passed by the fifty-sixth legislature, first regular session, and signed into law by the governor.

Arizona taxpayers who meet both of these criteria:

• Claimed Arizona’s dependent tax credit on their 2021 full year Arizona resident individual income tax returns (Arizona Form 140 or 140A). 
• Had at least $1 of Arizona individual income tax on their 2021 returns or had at least $1 Arizona individual income tax on their 2020 or 2019 Arizona returns under the same filing status as their 2021 return.

No, you will not owe ADOR any money for taking the rebate. The Arizona Families Tax Rebate is deductible for Arizona individual income tax purposes.

For eligible taxpayers, the rebate is $250 per dependent under age 17 and $100 per dependent over age 17 as claimed on their 2021 returns. A taxpayer cannot claim more than three dependents, regardless of age. The maximum amount of a taxpayer’s rebate is $750 for single, head of household, and married filing separately. The maximum amount of a taxpayer’s rebate is $1,500 for married filing jointly. 

The maximum amount of a taxpayer’s rebate is $750 for single, head of household, and married filing separately. The maximum amount of a taxpayer’s rebate is $1,500 for married filing jointly*. 

*For example:
In 2021, Family A had three dependents under age 17 (maximum $750).
In 2021, Family B had three dependents under age 17 (maximum $750).

In 2023, Family A and Family B got married. In 2024, they file their 2023 tax return, and together, they are allowed to claim a maximum of $1,500 when filing married filing jointly.

No. To qualify for a rebate, you must have had at least $1 of Arizona individual income tax in tax year 2021, 2020, or 2019. If Arizona tax credits reduced your Arizona income tax liability to zero in all of these tax years, you are not eligible for the rebate.

Yes. Taxpayers who paid Arizona individual income tax and received a refund of their Arizona withholding or estimated tax payments are still eligible for the tax rebate.

No. Taxpayers who did not claim the dependent tax credit on their tax year 2021 income tax returns are ineligible for the rebate.

Yes. Assuming all the other requirements are met (see eligibility above), you are eligible for a rebate.

No. A taxpayer must have claimed the dependent tax credit in 2021 to qualify for the rebate. If your income exceeded the dependent tax credit threshold in 2021, you are ineligible for the rebate.

If the amended return for tax year 2021 has been filed and processed prior to the direct deposits and checks being mailed out, the qualified taxpayer will receive a direct deposit or check like other qualified taxpayers. However, if the return has not been processed or received in time the taxpayer will need to make a claim on the Arizona Department of Revenue’s online portal.

Yes, the tax rebate will be sent to the direct deposit account on file or a paper check will be issued to the last known address referenced in your tax year 2021 or 2022 return filed with the Arizona Department of Revenue (ADOR). If any of that information has changed and the payment is returned to ADOR, such that you have not received it, you will have the opportunity to submit a claim through ADOR’s online portal. 

No. The rebate will either be issued to the direct deposit account provided on the 2021 Arizona individual income tax return or ADOR will send a rebate check to the last known address of the qualifying taxpayer. The taxpayer to whom ADOR will issue the check is the first-listed taxpayer on the 2021 joint individual income tax return. Thus, if your ex-spouse was the first-listed taxpayer on the joint return, ADOR will issue the rebate to your ex-spouse.

The rebates will be issued by direct deposit for taxpayers who provided direct deposit information when they filed their returns in 2021 or 2022. If ADOR does not have a taxpayer’s direct deposit information, a paper check will be mailed to the taxpayer’s last known address.

Rebates are being paid based on 2021 and 2022 tax return information that you already filed. For this reason, if your direct deposit information is out of date and the rebate payment is not successfully processed, the Arizona Department of Revenue (ADOR) will issue a paper check to your last known address.

If you did not provide your direct deposit information as part of your tax year 2021 or 2022 individual income tax return, and the check sent to your last known address is returned, you may file a claim using the Arizona Department of Revenue’s online claim portal (familyrebate.aztaxes.gov).

No. Interest will not be paid on the rebates, even for taxpayers who receive their rebates in 2024 and beyond.

No, the rebates are not subject to set-offs. Taxpayers will receive their full amount of rebate payments, even if they have liabilities with other state or federal agencies.

The Internal Revenue Service has determined that the rebate is subject to federal income tax and, thus, requires it to be reported as part of your federal adjusted gross income on your 2023 federal income tax return. For this reason, the Arizona Department of Revenue is issuing a Form 1099-MISC, Miscellaneous Information, which reports miscellaneous compensation and other payments, to those who received an Arizona Families Tax Rebate. 

Note that the rebate is not subject to Arizona income tax and should be subtracted from your federal adjusted gross income on your 2023 Arizona individual income tax return.

No. The Arizona Families Tax Rebate is not subject to Arizona income tax and should be subtracted from your federal adjusted gross income on your 2023 Arizona individual income tax return.

Form 1099-MISC is a federal form used to report miscellaneous income. The payor of the miscellaneous income is required by the Internal Revenue Service (IRS) to issue a Form 1099-MISC to both the recipient of the income and the IRS. This amount may be taxable to you. 

Form 1099-MISC, Miscellaneous Information, reports miscellaneous compensation and other payments such as this rebate.

ADOR will provide you with your Form 1099-MISC online through its secure portal. You will be able to access your Form 1099-MISC on and after January 31, 2024 by visiting azdor.gov/arizona-families-tax-rebate and clicking on the applicable link. Once there, you will be prompted to enter certain identifying information, which will then permit you to download a copy of your Form 1099-MISC.

If you do not have a computer, access to the internet or are otherwise unable to successfully download Form 1099-MISC, you can request a copy of it by contacting ADOR’s Arizona Families Tax Rebate team at (602) 716-6855.

Yes, but in order to claim a rebate of a qualified deceased taxpayer, the claim must be filed on the Arizona Department of Revenue’s online portal. You will have to submit additional documentation to demonstrate you are entitled to the rebate, as further explained in the instructions for the claims process.

If you are inquiring on behalf of a taxpayer, you must have a Power of Attorney on file that the taxpayer has authorized the Department to discuss the taxpayers confidential tax information with you. The Arizona Families Tax Rebate portal contains a link to the Power of Attorney form.

The Arizona Department of Revenue is pleased to inform you that, as a result of Governor Hobbs’ 2023 bipartisan budget, you may be eligible for a one-time Arizona Families Tax Rebate. This rebate is being issued pursuant to Senate Bill 1734, as passed by the fifty-sixth legislature, first regular session, and signed into law by the governor. If you received a letter regarding the Arizona Families Tax Rebate from the Arizona Department of Revenue, this letter is legitimate, and as explained in the letter, you received the rebate through direct deposit in November 2023. The Arizona Families Tax Rebate portal (familyrebate.aztaxes.gov) launched and contains resources on how to check your eligibility and status.

Direct deposit rebates were deposited in November 2023.