AZ SB1686

Establishes a new income tax credit for Arizona taxpayers who pay residential rent for at least 30 days within the state and whose federal adjusted gross income does not exceed $70,000 (single) or $140,000 (married/head of household).

Credit amount equals the transaction privilege tax paid on residential rent, with property owners required to provide tenants an annual statement showing the TPT amount paid on their rent.

Allows excess credits beyond income tax liability to be refunded to taxpayers, subject to standard setoff provisions.

Permits low-income tenants with no tax liability who do not meet filing requirements to claim the credit without filing a full income tax return.

Adds the new credit to the legislative income tax credit review schedule for years ending in 3 and 8.