COMMITTEE ON COMMERCE
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2264
(Reference to printed bill)
Strike everything after the enacting clause and insert:
"Section 1. Title 41, chapter 10, article 1, Arizona Revised Statutes, is amended by adding section 41-1526, to read:
41-1526. Certification of businesses for property tax classification; employment and capital investment requirements; reports; definitions
A. Beginning July 1, 2014 through June 30, 2019, the Arizona commerce authority shall annually certify businesses that qualify for property tax incentives under this section. New personal property and real property improvements that are newly constructed or undergo a major renovation from and after December 31, 2013 through June 30, 2019 and that are owned or used by a certified business may be classified as class six property pursuant to section 42‑12006. To qualify for classification as class six property, the new personal property or real property improvements shall not be used primarily for retail, utility, hospital or mining operations. To qualify under this section, the business must:
1. Be a manufacturing operation, corporate or regional headquarters, administrative office or research and development operations of an export oriented manufacturer. For the purposes of this paragraph, "export oriented manufacturer" means a manufacturer that does both of the following:
(a) Makes sixty-five per cent or more of its sales out of this state.
(b) Is classified in sections 31, 32 and 33 of the 2007 edition of the north American industry classification system as published by the national technical information service of the United States department of commerce.
2. Invest at least twenty-five million dollars of capital investment within a three-year period and create at least one hundred twenty-five new qualified employment positions within the exterior boundaries of a city or town that has a population of fifty thousand persons or more and that is located in a county that has a population of eight hundred thousand persons or more.
3. Invest at least two million dollars of capital investment within a three-year period and create at least fifteen qualified employment positions in any other location, except that if the business is relocating from a location within this state described in paragraph 2 of this subsection, it must meet the investment and employment requirements prescribed by paragraph 2 of this subsection.
4. Pay at least fifty‑one per cent of the new employees in qualified employment positions compensation equal to:
(a) One hundred twenty-five per cent of the median wage by county as computed annually by the authority within the exterior boundaries of a city or town that has a population of fifty thousand persons or more and that is located in a county that has a population of eight hundred thousand persons or more.
(b) One hundred ten per cent of the median wage by county as computed annually by the authority in any other location.
5. Certify to the authority that none of the employees filling qualified employment positions were employed by the business during the twelve months before the current date of hire except for those relocating to this state.
6. Obtain and submit to the authority a resolution of the governing body of the city or town in which the business will be located, or of the county board of supervisors if the business will not be located in a city or town. The resolution must acknowledge that the business intends to meet the requirements of this section and consent to the reduced assessed valuation of the taxable property. The governing body must establish a policy review committee responsible for recommending to the governing body approval or disapproval of the resolution required by this paragraph. Approval shall not be unreasonably withheld. After making its recommendation with respect to the business and approval or disapproval by the governing body, the policy review committee is dissolved. The committee shall include:
(a) A representative of the county.
(b) A representative of the city or town, as applicable.
(c) A representative of any community college district in which the business will be located.
(d) A representative of each school district in which the business will be located.
(e) A representative of another special taxing district in which the business will be located.
B. The authority shall not certify any business for qualification for property tax incentives after June 30, 2019 except as provided by subsections F and G of this section. However, certification under this section is valid for ten years, including after 2019, subject to annual recertification if the business continues to meet the other eligibility requirements.
C. To be annually recertified pursuant to subsection B of this section, a business must continue to meet all the eligibility requirements of this section and must annually report the following and provide supporting documentation to the authority on a form and in a manner approved by the authority:
1. The business name and mailing address and any other contact information requested by the authority.
2. The physical address of the business location.
3. The assessor's parcel number of real property to which the class six assessment classification will apply.
4. If available, the assessor's account number for personal property to which the class six assessment classification will apply.
5. For the location, the gross receipts, gross payroll and average hourly wage paid to employees for the preceding tax year.
6. Documentation that establishes the type and amount of business activity conducted at the location.
7. Ownership and full cash value of real and personal property to be certified.
8. Changes in location, ownership and operations of the business in the immediately preceding year.
9. The average number of full‑time employees at the location for the immediately preceding year.
10. Other information necessary for the management of these property tax incentives as determined by the authority.
D. To receive classification as class six property for tax purposes, on or before December 10 of each year the certified business must submit to the assessor of the county in which the property is located:
1. A copy of the authority's initial certification.
2. A copy of the current annual recertification.
3. A written request to classify the property as class six.
E. A business shall submit its application for initial certification or annual recertification to the authority not later than October 1 of each year. The authority shall notify the appropriate county assessors of all qualified properties located in the assessor's county not later than December 1 of each year.
F. If a business moves from the originally certified location, it loses its eligibility. The business may apply for certification at a new location for the remainder of its ten years if it meets the minimum investment requirements in fixed assets that were not moved from the prior location, meets all other eligibility requirements of this section and has not reached the ten year eligibility limit. For the purposes of this subsection, "fixed assets" means property that is used in operating a business, such as furniture, land, buildings and machinery, and that is not ordinarily converted into cash after it is declared a fixed asset.
G. If a certified business is purchased by another entity or changes by more than twenty per cent of the ownership interest through reorganization, stock purchase or merger, the certification is terminated. The new business may apply for certification according to eligibility requirements of this section.
H. The authority by rule may prescribe additional reporting requirements for persons who claim a tax benefit pursuant to this section.
I. The authority shall:
1. Monitor the implementation and operation of this section and continually evaluate the progress made in attracting new businesses.
2. Assist an employer or prospective employer to obtain the benefits of any incentive or inducement authorized pursuant to this section.
3. Provide information regarding the business incentives on request and conduct informational and instructional seminars and training.
4. Notify the department of revenue and the county assessor if a certified business closes, moves or fails to maintain its eligibility, and the assessor shall make the appropriate changes to the classification of the property on the tax roll. The authority may give special consideration, or allow temporary exemption from disqualification under this paragraph, in the case of extraordinary hardship due to factors beyond the control of the qualifying business.
J. The authority may make site visits to a taxpayer's facilities if it is necessary to further document or clarify reported information. The taxpayer must freely provide the access.
K. Documents filed with the authority pursuant to this section shall contain either a sworn statement or certification, signed by an officer of the business under penalty of perjury, that the information contained is true and correct according to the best belief and knowledge of the person submitting the information after a reasonable investigation of the facts. If the document contains information that is materially false, the taxpayer is ineligible for the tax benefits under this section and is subject to recovery of the amount of tax benefits allowed in preceding years based on the false information, including penalties and interest.
L. On or before September 30 of each year, the authority shall transmit a report to the governor, the president of the senate, the speaker of the house of representatives and the chairpersons of the senate finance committee and the house of representatives ways and means committee, or their successor committees, and shall provide a copy of the report to the secretary of state. The report is in addition to, but may be combined with, the report under section 41-1525, subsection K. The report shall contain the following information:
1. The amount of capital investment made during the preceding fiscal year and cumulatively for the purposes of qualifying for the tax incentives under this section.
2. The number of businesses certified for property tax incentives in the preceding fiscal year and cumulatively, and for each such business:
(a) The name and location.
(b) The number of employees.
(c) The full cash value of the property qualifying for classification as class six pursuant to section 42‑12006.
3. An evaluation of the effectiveness of the incentives and any suggestions to improve the incentives.
M. On or before September 30 of each year, the department of revenue shall transmit a report to the governor, the president of the senate, the speaker of the house of representatives and the chairpersons of the senate finance committee and the house of representatives ways and means committee, or their successor committees, and shall provide a copy of the report to the secretary of state. The report shall contain the following information:
1. The full cash value and assessed valuation of property classified as class six pursuant to section 42‑12006, paragraph 9 and the assessed valuation of that property if it were not classified as class six.
2. The fiscal impact on each taxing jurisdiction for the current tax year of classifying property as class six rather than in the classification in which it would otherwise be classified.
N. For the purposes of this section:
1. "Capital investment" means an expenditure to:
(a) Acquire or improve property that is used in operating a business, including land, buildings, machinery and fixtures.
(b) Lease machinery or equipment that is used in operating a business.
2. "Location" means a single parcel or contiguous parcels of owned or leased land in this state, the structures and personal property contained on the land or any part of the structures occupied by the owner.
3. "Qualified employment position" means employment that meets the following requirements:
(a) The position consists of at least one thousand seven hundred fifty hours per year of full-time permanent employment.
(b) The job duties are performed primarily at the location or locations of the business.
(c) The employment provides health insurance coverage for the employee for which the employer pays at least sixty-five per cent of the premium or membership cost. If the business is self-insured, the employer pays at least sixty-five per cent of a predetermined fixed cost per employee for an insurance program that is payable whether or not the employee has filed claims.
(d) The position does not include employment in retail, utility, hospital or mining operations.
Sec. 2. Section 42-12006, Arizona Revised Statutes, is amended to read:
42-12006. Class six property
For purposes of taxation, class six is established consisting of:
1. Noncommercial historic property as defined in section 42‑12101 and valued at full cash value.
2. Real and personal property that is located within the area of a foreign trade zone or subzone established under 19 United States Code section 81 and title 44, chapter 18, that is activated for foreign trade zone use by the district director of the United States customs service pursuant to 19 Code of Federal Regulations section 146.6 and that is valued at full cash value. Property that is classified under this paragraph shall not thereafter be classified under paragraph 6 of this section.
3. Real and personal property and improvements that are located in a military reuse zone that is established under title 41, chapter 10, article 3 and that is devoted to providing aviation or aerospace services or to manufacturing, assembling or fabricating aviation or aerospace products, valued at full cash value and subject to the following terms and conditions:
(a) Property may not be classified under this paragraph for more than five tax years.
(b) Any new addition or improvement to property already classified under this paragraph qualifies separately for classification under this paragraph for not more than five tax years.
(c) If a military reuse zone is terminated, the property in that zone that was previously classified under this paragraph shall be reclassified as prescribed by this article.
(d) Property that is classified under this paragraph shall not thereafter be classified under paragraph 6 of this section.
4. Real and personal property and improvements or a portion of such property comprising an environmental technology manufacturing, producing or processing facility that qualified under section 41‑1514.02, valued at full cash value and subject to the following terms and conditions:
(a) Property shall be classified under this paragraph for twenty tax years from the date placed in service.
(b) Any addition or improvement to property already classified under this paragraph qualifies separately for classification under this subdivision for an additional twenty tax years from the date placed in service.
(c) After revocation of certification under section 41‑1514.02, property that was previously classified under this paragraph shall be reclassified as prescribed by this article.
(d) Property that is classified under this paragraph shall not thereafter be classified under paragraph 6 of this section.
5. That portion of real and personal property that is used on or after January 1, 1999 specifically and solely for remediation of the environment by an action that has been determined to be reasonable and necessary to respond to the release or threatened release of a hazardous substance by the department of environmental quality pursuant to section 49‑282.06 or pursuant to its corrective action authority under rules adopted pursuant to section 49‑922, subsection B, paragraph 4 or by the United States environmental protection agency pursuant to the national contingency plan (40 Code of Federal Regulations part 300) and that is valued at full cash value. Property that is not being used specifically and solely for the remediation objectives described in this paragraph shall not be classified under this paragraph. For the purposes of this paragraph, "remediation of the environment" means one or more of the following actions:
(a) Monitoring, assessing or evaluating the release or threatened release.
(b) Excavating, removing, transporting, treating and disposing of contaminated soil.
(c) Pumping and treating contaminated water.
(d) Treatment, containment or removal of contaminants in groundwater or soil.
6. Real and personal property and improvements constructed or installed from and after December 31, 2004 through December 31, 2024 and owned by a qualified business under section 41‑1516 and used solely for the purpose of harvesting, transporting or processing qualifying forest products removed from qualifying projects as defined in section 41‑1516. The classification under this paragraph is subject to the following terms and conditions:
(a) Property may be initially classified under this paragraph only in valuation years 2005 through 2024.
(b) Property may not be classified under this paragraph for more than five years.
(c) Any new addition or improvement, constructed or installed from and after December 31, 2004 through December 31, 2024, to property already classified under this paragraph qualifies separately for classification and assessment under this paragraph for not more than five years.
(d) Property that is classified under this paragraph shall not thereafter be classified under paragraph 2, 3 or 4 of this section.
7. Real and personal property and improvements to the property that are used specifically and solely to manufacture from and after December 31, 2006 through December 31, 2016 biodiesel fuel that is one hundred per cent biodiesel and its by-products and that are valued at full cash value. This paragraph applies only to the portion of property that is used specifically for manufacturing and processing one hundred per cent biodiesel fuel, or its related by-products, from raw feedstock obtained from off-site sources, including necessary on-site storage facilities that are intrinsically associated with the manufacturing process. Any other commercial or industrial use disqualifies the entire property from classification under this paragraph.
8. Real and personal property and improvements that are certified pursuant to section 41‑1511, subsection C, paragraph 2 and that are used for renewable energy manufacturing or headquarters operations as provided by section 42‑12057. This paragraph applies only to property that is used in manufacturing and headquarters operations of renewable energy companies, including necessary on-site research and development, testing and storage facilities that are associated with the manufacturing process. Up to ten per cent of the aggregate full cash value of the property may be derived from uses that are ancillary to and intrinsically associated with the manufacturing process or headquarters operation. Any additional ancillary property is not qualified for classification under this paragraph. No new properties may be classified pursuant to this paragraph from and after December 31, 2014. Classification under this paragraph is limited to the time periods determined by the Arizona commerce authority pursuant to section 41‑1511, subsection C, paragraph 2, subdivision (a) or (b). Property that is classified under this paragraph shall not thereafter be classified under any other paragraph of this section.
9. New personal property and real property improvements that are newly constructed or undergo a major renovation from and after December 31, 2013 through June 30, 2019 and that are owned or used by a business that meets the requirements of, and is certified by the Arizona commerce authority pursuant to section 41-1526. Property may not be classified under this paragraph for more than ten tax years. Property that has been classified under this paragraph shall not thereafter be classified under any other provision of this section.
Sec. 3. Section 42-12057, Arizona Revised Statutes, is amended to read:
42-12057. Criteria for renewable energy property
A. To qualify for the classification as class six pursuant to section 42‑12006, paragraph 9 8, the owner of a manufacturing facility or headquarters facility must be certified pursuant to section 41‑1511, subsection C and must provide documentation to the county assessor each year that the facility is primarily dedicated to renewable energy manufacturing or regional, national or global renewable energy business headquarters operations.
B. For the purposes of this section, renewable energy operations are limited to manufacturers of, and headquarters for, systems and components that are used or useful in manufacturing renewable energy equipment for the generation, storage, testing and research and development, transmission or distribution of electricity from renewable resources, including specialized crates necessary to package the renewable energy equipment manufactured at the facility.
Sec. 4. Section 43-1022, Arizona Revised Statutes, is amended to read:
43-1022. Subtractions from Arizona gross income
In computing Arizona adjusted gross income, the following amounts shall be subtracted from Arizona gross income:
1. The amount of exemptions allowed by section 43‑1023.
2. Benefits, annuities and pensions in an amount totaling not more than two thousand five hundred dollars received from one or more of the following:
(a) The United States government service retirement and disability fund, retired or retainer pay of the uniformed services of the United States, the United States foreign service retirement and disability system and any other retirement system or plan established by federal law.
(b) The Arizona state retirement system, the corrections officer retirement plan, the public safety personnel retirement system, the elected officials' retirement plan, an optional retirement program established by the Arizona board of regents under section 15‑1628, an optional retirement program established by a community college district board under section 15‑1451 or a retirement plan established for employees of a county, city or town in this state.
3. A beneficiary's share of the fiduciary adjustment to the extent that the amount determined by section 43‑1333 decreases the beneficiary's Arizona gross income.
4. The amount of any distributions from an individual retirement account as provided for in section 408 of the internal revenue code or from a qualified retirement plan of a self‑employed individual as provided for in section 401 of the internal revenue code to the extent that total adjustments made pursuant to this paragraph in all tax years do not exceed the total of all contributions made by the taxpayer to such plans before December 31, 1975, which were included in computing Arizona taxable income.
5. The amount of income on an installment receivable that is recognized pursuant to the internal revenue code and that has already been recognized on the death of the taxpayer for purposes of this title for tax years ending before January 1, 1990.
6. Interest income received on obligations of the United States, less any interest on indebtedness, or other related expenses, and deducted in arriving at Arizona gross income, which were incurred or continued to purchase or carry such obligations.
7. The amount of any income tax refunds that were received from states other than Arizona and that were included as income in computing federal adjusted gross income.
8. Annuity income included in federal adjusted gross income pursuant to section 72 of the internal revenue code if the first payment with respect to such annuity was received before December 31, 1978.
9. The excess of a partner's share of income required to be included under section 702(a)(8) of the internal revenue code over the income required to be included under chapter 14, article 2 of this title.
10. The excess of a partner's share of partnership losses determined pursuant to chapter 14, article 2 of this title over the losses allowable under section 702(a)(8) of the internal revenue code.
11. The amount by which the adjusted basis of property described in this paragraph and computed pursuant to this title and the income tax act of 1954, as amended, exceeds the adjusted basis of such property computed pursuant to the internal revenue code. This paragraph shall apply to all property that is held for the production of income and that is sold or otherwise disposed of during the taxable year other than depreciable property used in a trade or business.
12. The amount allowed by section 43‑1024 for amortization, by a qualified defense contractor certified by the Arizona commerce authority under section 41‑1508, of a capital investment for private commercial activities.
13. The amount of gain included in federal adjusted gross income on the sale or other disposition of a capital investment that a qualified defense contractor has elected to amortize pursuant to section 43‑1024.
14. The amount allowed by section 43‑1025 for contributions during the taxable year of agricultural crops to charitable organizations.
15. The portion of any wages or salaries paid or incurred by the taxpayer for the taxable year that is equal to the amount of the federal work opportunity credit, the empowerment zone employment credit, the credit for employer paid social security taxes on employee cash tips and the Indian employment credit that the taxpayer received under sections 45A, 45B, 51(a) and 1396 of the internal revenue code.
16. The amount of prizes or winnings less than five thousand dollars in a single taxable year from any of the state lotteries established and operated pursuant to title 5, chapter 5.1, article 1, except that all such winnings before March 22, 1983, including periodic distributions from such winnings made after March 22, 1983, may be subtracted.
17. The amount of exploration expenses that is determined pursuant to section 617 of the internal revenue code, that has been deferred in a taxable year ending before January 1, 1990 and for which a subtraction has not previously been made. The subtraction shall be made on a ratable basis as the units of produced ores or minerals discovered or explored as a result of this exploration are sold.
18. The amount included in federal adjusted gross income pursuant to section 86 of the internal revenue code, relating to taxation of social security and railroad retirement benefits.
19. To the extent not already excluded from Arizona gross income under the internal revenue code, compensation received for active service as a member of the reserves, the national guard or the armed forces of the United States, including compensation for service in a combat zone as determined under section 112 of the internal revenue code.
20. The amount of unreimbursed medical and hospital costs, adoption counseling, legal and agency fees and other nonrecurring costs of adoption not to exceed three thousand dollars. In the case of a husband and wife who file separate returns, the subtraction may be taken by either taxpayer or may be divided between them, but the total subtractions allowed both husband and wife shall not exceed three thousand dollars. The subtraction under this paragraph may be taken for the costs that are described in this paragraph and that are incurred in prior years, but the subtraction may be taken only in the year during which the final adoption order is granted.
21. The amount authorized by section 43‑1027 for the taxable year relating to qualified wood stoves, wood fireplaces or gas fired fireplaces.
22. With respect to a medical savings account established pursuant to section 43‑1028:
(a) An eligible individual may subtract:
(i) The amount of contributions made by the individual's employer during the taxable year to the individual's medical savings account pursuant to section 43‑1028 to the extent that the employer contributions are included in the individual's federal adjusted gross income.
(ii) The amount deposited by the individual in the account during the taxable year to the extent that the individual's contributions are included in the individual's federal adjusted gross income.
(b) The individual's employer may subtract the amount of contributions made by the employer to a medical savings account established on the individual's behalf to the extent that the contributions are not deductible under the internal revenue code.
23. The amount by which a net operating loss carryover or capital loss carryover allowable pursuant to section 43‑1029, subsection F exceeds the net operating loss carryover or capital loss carryover allowable pursuant to section 1341(b)(5) of the internal revenue code.
24. Any amount of qualified educational expenses that is distributed from a qualified state tuition program determined pursuant to section 529 of the internal revenue code and that is included in income in computing federal adjusted gross income.
25. Any item of income resulting from an installment sale that has been properly subjected to income tax in another state in a previous taxable year and that is included in Arizona gross income in the current taxable year.
26. The amount authorized by section 43‑1030 relating to holocaust survivors.
27. For property placed in service:
(a) In taxable years ending through December 31, 2012, an amount equal to the depreciation allowable pursuant to section 167(a) of the internal revenue code for the taxable year computed as if the election described in section 168(k)(2)(D)(iii) of the internal revenue code had been made for each applicable class of property in the year the property was placed in service.
(b) In taxable years beginning from and after December 31, 2012 through December 31, 2013, an amount determined in the year the asset was placed in service based on the calculation in subdivision (a) of this paragraph. In the first taxable year beginning from and after December 31, 2013, the amount necessary to make the depreciation claimed to date for the purposes of this title the same as it would have been if subdivision (c) of this paragraph had applied for the entire time the asset was in service. Subdivision (c) of this paragraph applies for the remainder of the asset's life.
(c) In taxable years beginning from and after December 31, 2013, an amount equal to the depreciation allowable pursuant to section 167(a) of the internal revenue code for the taxable year as computed as if the additional allowance for depreciation had been ten per cent of the amount allowed pursuant to section 168(k) of the internal revenue code.
28. With respect to property that is sold or otherwise disposed of during the taxable year by a taxpayer that complied with section 43‑1021, paragraph 25 with respect to that property, the amount of depreciation that has been allowed pursuant to section 167(a) of the internal revenue code to the extent that the amount has not already reduced Arizona taxable income in the current or prior taxable years.
29. With respect to property for which an adjustment was made under section 43‑1021, paragraph 26, an amount equal to one‑fifth of the amount of the adjustment pursuant to section 43‑1021, paragraph 26 in the year in which the amount was adjusted under section 43‑1021, paragraph 26 and in each of the following four years.
30. The amount contributed during the taxable year to college savings plans established pursuant to section 529 of the internal revenue code to the extent that the contributions were not deducted in computing federal adjusted gross income. The amount subtracted shall not exceed:
(a) Seven hundred fifty dollars for a single individual or a head of household.
(b) One thousand five hundred dollars for a married couple filing a joint return. In the case of a husband and wife who file separate returns, the subtraction may be taken by either taxpayer or may be divided between them, but the total subtractions allowed both husband and wife shall not exceed one thousand five hundred dollars.
31. The amount of any original issue discount that was deferred and not allowed to be deducted in computing federal adjusted gross income or federal taxable income in the current taxable year pursuant to section 108(i) of the internal revenue code as added by section 1231 of the American recovery and reinvestment act of 2009 (P.L. 111‑5).
32. The amount of previously deferred discharge of indebtedness income that is included in the computation of federal adjusted gross income or federal taxable income in the current taxable year pursuant to section 108(i) of the internal revenue code as added by section 1231 of the American recovery and reinvestment act of 2009 (P.L. 111-5), to the extent that the amount was previously added to Arizona gross income pursuant to section 43‑1021, paragraph 32.
33. The portion of the net operating loss carryforward that would have been allowed as a deduction in the current year pursuant to section 172 of the internal revenue code if the election described in section 172(b)(1)(H) of the internal revenue code had not been made in the year of the loss that exceeds the actual net operating loss carryforward that was deducted in arriving at federal adjusted gross income. This subtraction only applies to taxpayers who made an election under section 172(b)(1)(H) of the internal revenue code as amended by section 1211 of the American recovery and reinvestment act of 2009 (P.L. 111‑5) or as amended by section 13 of the worker, homeownership, and business assistance act of 2009 (P.L. 111‑92).
34. For taxable years beginning from and after December 31, 2013, the amount of any net capital gain included in federal adjusted gross income for the taxable year derived from investment in a qualified small business as determined by the Arizona commerce authority pursuant to section 41‑1518.
35. An amount of any net long-term capital gain included in federal adjusted gross income for the taxable year that is derived from an investment in an asset acquired after December 31, 2011, as follows:
(a) For taxable years beginning from and after December 31, 2012 through December 31, 2013, ten per cent of the net long-term capital gain included in federal adjusted gross income.
(b) For taxable years beginning from and after December 31, 2013 through December 31, 2014, twenty per cent of the net long-term capital gain included in federal adjusted gross income.
(c) For taxable years beginning from and after December 31, 2014, twenty-five per cent of the net long-term capital gain included in federal adjusted gross income.
36. If an individual is not claiming itemized deductions pursuant to section 43‑1042, the amount of premium costs for long-term care insurance, as defined in section 20‑1691.
37. With respect to a long-term health care savings account established pursuant to section 43‑1032, the amount deposited by the taxpayer in the account during the taxable year to the extent that the taxpayer's contributions are included in the taxpayer's federal adjusted gross income.
38. The following percentage of compensation and net income from self‑employment, up to one hundred thirteen thousand seven hundred dollars of compensation and net income from self-employment, to the extent that the compensation and net income are not otherwise subtracted pursuant to this section:
(a) For taxable years beginning from and after December 31, 2012 through December 31, 2013, one-half per cent.
(b) For taxable years beginning from and after December 31, 2013 through December 31, 2014, one per cent.
(c) For taxable years beginning from and after December 31, 2014 through December 31, 2015, one and one-half per cent.
(d) For taxable years beginning from and after December 31, 2015, Two per cent.
Sec. 5. Adoption of rules
The Arizona commerce authority shall adopt rules to implement section 41-1526, Arizona Revised Statutes, as added by this act, on or before January 1, 2014."
Amend title to conform