HB 2778 Summary

• Repeals Arizona Revised Statutes section 28-2007 effective December 31, 2020, and removes related deposits to the Arizona highway patrol fund.

• Adjusts Arizona income tax rates for taxable years beginning January 1, 2020, reducing tax brackets and rates for single filers, heads of household, and married couples filing jointly.

• Establishes a 50 percent subtraction for net long-term capital gains on assets acquired after December 31, 2019, and adjusts depreciation-related additions and subtractions for both individual and corporate taxpayers.

• Modifies the standard deduction amounts and allows adjustment for inflation beginning in 2020, with charitable deductions receiving enhanced treatment through an increased standard deduction percentage.

• Applies changes retroactively to taxable years beginning January 1, 2020, except for the repeal of section 28-2007 which becomes effective December 31, 2020.