AZ SB1135

Adds a new subtraction (paragraph 28) to Arizona Revised Statutes section 43-1022 for contributions to Achieving a Better Life Experience (ABLE) accounts established under Internal Revenue Code section 529A, effective for taxable years beginning after December 31, 2020.

Allows ABLE account contribution subtraction limits of $2,000 per beneficiary for single individuals or heads of household, and $4,000 per beneficiary for married couples filing joint returns.

Permits married couples filing separate returns to claim the ABLE subtraction individually or divide it between them, with a combined maximum of $4,000 per beneficiary.

Restricts the ABLE subtraction to contributions not already deducted in computing federal adjusted gross income.

Makes the changes retroactively applicable to all taxable years beginning after December 31, 2020.