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ArizonaSB 1749Fifty-seventh Legislature - First Regular SessionSenateWALLET

2025-2026; taxation; omnibus

Sponsored By: Sponsor information unavailable

Signed by Governor

2025-2026applicabilitybudget billsbudget reconciliationdefinitionseffective dateexempt personal propertyexemption for propertyexemptionsomnibuspersons with a total and permanent disabilitypublic school fees and contributionsretail classificationretroactivitysubtractions from arizona gross incometax credittaxationtaxation - title 42taxation of income - title 43veterans with a disabilitywidows and widowers

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Bill Overview

Analyzed Economic Effects

7 provisions identified: 7 benefits, 0 costs, 0 mixed.

More property tax relief for veterans

Arizona veterans with a 100% service-connected disability can receive a full property tax exemption if they meet the income limit. Other qualifying veterans can receive an exemption of up to $4,188 multiplied by their disability percentage. Veterans pension payments do not count toward the income test. A surviving spouse can keep the full exemption while the home remains their main residence and they do not remarry. Starting in tax year 2026, the state adjusts certain exemption limits each year using the federal house price index or GDP price deflator.

Larger tax break for adoptive families

For Arizona tax years starting after December 31, 2025, single filers and heads of household can subtract up to $5,000 in eligible adoption costs. Married couples filing jointly can subtract up to $10,000, and spouses filing separately share that $10,000 limit. Eligible costs include unreimbursed medical and hospital costs, counseling, legal and agency fees, and other nonrecurring adoption costs. Costs from earlier years count only in the year the final adoption order is granted.

Higher property tax cap for farms and businesses

The property tax exemption cap for qualifying farm or business personal property rises from $207,366 to $500,000 per taxpayer. The cap continues to change each year based on the specified employment cost index.

Public school donations get tax credits

Taxpayers can claim a credit through June 30, 2029, for qualifying public school fees or cash donations for listed purposes, including capital items, school meal programs, health supplies, playground equipment, and shade structures. The limit is $200 for single filers or heads of household and $400 for married couples filing jointly. Spouses filing separately may each claim up to $200. Individual meal or meal-card payments do not qualify, and the change applies retroactively from after June 28, 2024.

Tax breaks for digital assets and currency

Arizona taxpayers can subtract qualifying amounts from exchanging one kind of legal tender for another. They can also subtract the value of virtual currency or non-fungible tokens received through an airdrop, unless federal tax rules already exclude that value. Later increases in an airdropped asset’s value do not qualify. Eligible virtual-asset gas fees can be subtracted only when they are not already included in the asset’s tax basis.

Lower taxes on wastewater transport pipes

Sales of pipes or valves at least four inches in diameter are excluded from Arizona’s transaction privilege tax when they transport wastewater. The law does not state a dollar amount or effective date.

Lower utility taxes for certified centers

Arizona businesses with an international operations center certified by the Arizona Commerce Authority pay no tax under this article on electricity, natural gas, or liquefied petroleum gas purchases. The law does not state a dollar limit or effective date.

Sponsors & Cosponsors

Sponsors

There is no primary sponsor on record.

Cosponsors

  • John Kavanagh

    Republican • Senate

Roll Call Votes

All Roll Calls

Yes: 73 • No: 31

Senate vote • 6/26/2025

DP/C&P

Yes: 8 • No: 0

Senate vote • 6/26/2025

THIRD: Passed

Yes: 40 • No: 16

Senate vote • 6/19/2025

THIRD: Passed

Yes: 17 • No: 13

Senate vote • 6/17/2025

DP

Yes: 8 • No: 2

Actions Timeline

  1. Third Reading: Passed

    6/26/2025Senate

  2. Committee of the Whole: do pass

    6/26/2025Senate

  3. Miscellaneous Motion: Passed

    6/26/2025Senate

  4. undefined: DP/C&P

    6/26/2025Senate

  5. Third Reading: Passed

    6/19/2025Senate

  6. Committee of the Whole: do pass amended

    6/19/2025Senate

  7. undefined: PFC

    6/17/2025Senate

  8. undefined: DP

    6/17/2025Senate

Bill Text

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