AZ SB1682

Extends the phased transition to sales-factor-only apportionment for corporate income tax through December 31, 2023, after which all business income must be apportioned using the three-factor formula (property, payroll, and sales factors equally weighted).

Eliminates the multistate service provider election to use market-based sales allocation after December 31, 2023, and instead establishes a new market-based sourcing rule for all non-tangible property sales based on where the service is delivered or where the market is located.

Establishes specific sourcing rules for different types of intangible property sales after December 31, 2023, including real property leases, investment assets, and licensing agreements, with location determined by where the property is used or where the customer is located.

Requires the Department of Revenue to adopt rules implementing the new market-based sourcing provisions for taxable years beginning after December 31, 2023.

Maintains air commerce apportionment rules based on revenue aircraft miles flown within the state.