AZ HB4037

Creates a new "Education Opportunity Tax Credit" for Arizona taxpayers with qualifying children not enrolled in public school, effective for taxable years beginning after December 31, 2025.

Provides a refundable credit equal to 80% of the state's base support level funding amount for children who were not enrolled in public school and did not participate in an Arizona Empowerment Scholarship Account during the taxable year.

Allows a reduced credit of 40% of the base support level for children enrolled in public school or participating in an Empowerment Scholarship Account for 50% or fewer of the instructional days.

Defines "qualifying child" as a dependent eligible to enroll in Arizona public schools who was not enrolled for more than 50% of instructional days and did not participate in the Empowerment Scholarship Account program for more than 50% of instructional days.

Requires the Department of Revenue to adopt rules and coordinate with the Department of Education to verify enrollment status for credit claims.