Title 42, Taxation

A. The Arizona taxpayer assistance office is established as an office in the department. The employees of the office shall be selected by the director. The manager of the taxpayer assistance office is the taxpayer problem resolution officer. The office reports directly to the dir…

A. Notwithstanding sections 42-1123 and 42-1125, no interest or penalty may be assessed on an amount assessed as a deficiency if either: 1. The deficiency assessed is directly attributable to erroneous written advice furnished to the taxpayer by an employee of the department acti…

A. On the request of a taxpayer, and under circumstances prescribed by the department, an employee of the department, in connection with any interview with the taxpayer that relates to a deficiency in payment of any tax owed to the department, shall: 1. Conduct the interview in t…

On the written request of a taxpayer, information relating to the taxpayer may be disclosed, if the disclosure does not violate article 1 of this chapter.

A. The problem resolution officer, with or without a formal written request from a taxpayer, may issue a taxpayer assistance order that suspends or stays an action or proposed action by the department if, in the problem resolution officer's determination, a taxpayer is suffering …

A. If the department determines that noncompliance with tax obligations results from extensive misunderstanding or misapplication of provisions of this title or title 43 it may enter into closing agreements with those taxpayers under the following terms and conditions: 1. Extensi…

A. The department may enter into an agreement with a taxpayer to allow the taxpayer to satisfy a liability for any tax by means of installment payments. The department may require a taxpayer who requests an installment payment agreement to complete a financial report in such form…

A. The department shall establish procedures to monitor the performance of department employees that include, if applicable, using evaluations obtained from taxpayers. B. Fair and equitable treatment of taxpayers is a criterion for evaluating employee performance, including being…

A. When the department completes an audit or the findings of a managed audit are accepted by the director or approved on appeal and a deficiency has been completely determined under section 42-1108 or chapter 1, article 6 of this title, the taxpayer's liability for the particular…

A. Notwithstanding any statute of limitations provided in this title or title 43: 1. Any overpayment of taxes that is paid pursuant to title 43, that is due a taxpayer for any year and that results from a transfer of items of income or deductions, or both, to or from another year…

A. Within thirty days after the day on which the department furnishes the written notice described in section 42-1111, subsection A, the taxpayer may request the department to review the action taken as provided in section 42-1251. Within fifteen days after the request for review…

A. If a taxpayer has been assessed a penalty or fee pursuant to section 42-1107, 42-1125, 42-1126, 43-581 or 43-582, the department, on written application by the taxpayer, shall abate the penalty or fee if it determines that the conduct, or lack of conduct, that caused the asses…

A. The department shall attempt to issue a decision from the hearing officer within ninety days after the date of a formal hearing or after the last post-hearing brief is due, whichever is later. If the department expects the decision to be delayed, the department shall notify th…

A. A taxpayer who is a prevailing party may be reimbursed for reasonable fees and other costs related to an administrative proceeding that is brought by or against the department in connection with an assessment, determination, collection or refund of any tax listed in section 42…

A. The director, in the director's discretion, may abate all or part of any assessment if additional interest has accrued on: 1. A deficiency due to any unreasonable error or delay by an officer or employee of the department acting in the employee's official capacity. 2. Any paym…

A taxpayer's obligations for any tax, interest or penalty required to be collected by the department for any tax period are extinguished, if not previously satisfied, ten years after the amount of tax determined to be due becomes final unless one of the following circumstances ap…

A. Employees of the department shall not use pseudonyms when interacting with the public unless the director or the director's designee first determines on written request that the use of the pseudonym is appropriate. The employee's request must include adequate justification for…

A. Notwithstanding section 42-1106, the running of the statute of limitations for refunds is suspended if an individual, as defined in section 43-104, is financially disabled and eligible for equitable tolling of the statute of limitations for refunds under section 6511(h) of the…

A. With respect to tax advice, the same common law protections of confidentiality that apply to a communication between a taxpayer and an attorney also apply to a communication between a taxpayer and a federally authorized tax practitioner to the extent that the communication wou…

The department shall not use financial status or economic reality examination techniques to determine the existence of unreported income of any taxpayer, except in the following circumstances: 1. The director may authorize the use of financial status or economic reality examinati…

A. If the department of revenue issues a levy in error, or erroneously causes one or more checks or other negotiable instruments to be returned to the issuer by the issuer’s bank or financial institution, the taxpayer is entitled to reimbursement for reasonable bank charges, not …

A. A taxpayer who is unable to pay all of a liability may make an offer in compromise for abatement of part of the liability on the grounds that the remainder is uncollectible pursuant to section 42-1004, subsection B, paragraph 1. B. While the offer is under consideration by the…

A. On or before March 1 of each year, beginning in 2001, the director shall submit a detailed report of employee misconduct verified as valid to the governor, the speaker of the house of representatives and the president of the senate. The report shall include: 1. All categories …

A. The director may relieve an individual from joint and several liability under the following circumstances: 1. Taking into account all of the facts and circumstances, it is inequitable to hold the individual liable for all or part of any unpaid tax or any deficiency. 2. Relief …

A. An audit of a taxpayer's return or claim for refund shall not exceed two years after the date of initial audit contact to the issuance of a notice of proposed deficiency assessment or proposed overpayment, except: 1. An audit of a fraudulent tax return. 2. An audit delayed as …

At the time when the department issues a deficiency assessment or denies all or part of a claim for refund, the department shall also provide the taxpayer and, if applicable, the taxpayer's authorized representative with a written explanation of all adjustments made, including th…

A. Beginning October 1, 2006, the agencies listed in this section shall provide tax decisions to the law libraries of Maricopa county, the Arizona state university college of law, the university of Arizona college of law, the state law library and the Arizona state library, archi…

A. Unless expressly authorized by law, the department shall not apply any newly enacted law retroactively or in a manner that will penalize a taxpayer for complying with prior law. B. If the department adopts a new interpretation or application of any provision of this title or t…

A. Notwithstanding sections 42-1107 and 42-1123, the director shall specify a period of up to one year to extend any due date and suspend any penalty or interest that would ordinarily accrue during that time for any affected taxpayer in any of the following circumstances: 1. Sect…

A. The department may issue draft rulings, procedures, notices and administrative announcements that apply to tax laws and regulations, either generally or for a specific set of facts, and that otherwise do not change the substance and meaning of a statute or rule. Except for pri…

A. The department may issue private taxpayer rulings to taxpayers and potential taxpayers on request. Each request shall be in writing and shall: 1. State the name, address and, if applicable, taxpayer identifying number of the taxpayer or potential taxpayer who requests the ruli…

A. The department of revenue and the department of economic security shall cooperatively prepare and provide a single form by which any person desiring to engage in business may obtain: 1. Employer identification numbers for income tax withholding and unemployment insurance purpo…

The department of revenue shall: 1. Obtain and keep on file a list of the agencies, boards, commissions and departments, their addresses and telephone numbers and the subjects over which they have authority. 2. Provide a copy of this list to any person requesting a form under sec…

The department of revenue shall: 1. Develop a questionnaire that a person desiring to engage in business may fill out and return to the department. The questionnaire shall elicit information about the nature, size, form and operations of the proposed business. 2. Forward copies o…

This article does not: 1. Require any person to utilize the forms or procedures provided for in this article. 2. Eliminate other registration and licensing efforts by the department of revenue and the department of economic security.

A. Notwithstanding section 43-301, subsection C and section 43-562, after filing a joint income tax return pursuant to section 43-309, a taxpayer may seek relief from joint and several liability under the following circumstances: 1. There is an understatement of tax attributable …

A. Notwithstanding section 43-301, subsection C and section 43-562, a taxpayer who filed a joint income tax return under section 43-309 for a taxable year and who meets the following requirements may elect to limit the taxpayer's liability pursuant to this section with respect to…

A. Notwithstanding section 42-1122, at the time of filing a joint income tax return pursuant to section 43-309, a taxpayer may apply to the department for protection of the taxpayer's share of any overpayment or refund from setoff for the past due state taxes, child support, spou…

In this article, unless the context otherwise requires: 1. "Computer software executable code" includes: (a) Any object code, machine code or other code that is readable by a computer when loaded into its memory and used directly by the computer to execute instructions. (b) Any r…

A. Except as provided in section 42-2253, the department shall not issue any subpoena duces tecum under section 42-1006 or 42-1112 or commence any proceeding or action to enforce any subpoena duces tecum to produce any computer software source code. B. Subsection A of this sectio…

A. Notwithstanding section 42-2252, the department may issue a subpoena duces tecum for computer software if: 1. The department is unable to otherwise reasonably ascertain the correctness of any item on a return from either: (a) The taxpayer's books, papers, records or other data…

A. Any software or related materials that are provided to the department under this article are subject to the safeguards provided in this section. B. In any court proceeding to enforce a subpoena duces tecum for any portion of software, the court may receive evidence and issue a…

In this article, unless the context otherwise requires: 1. "Limited managed audit agreement" means a managed audit agreement that is limited in scope to certain periods, activities, lines of business, geographic areas or transactions, including tax on the receipts of certain sale…

A. On application by a taxpayer, the director, in the director's sole discretion, may agree to a managed audit with the taxpayer. The managed audit agreement shall: 1. Be signed by the taxpayer and the director. 2. Contain a declaration by the taxpayer that all statements of fact…

A. The taxpayer or the taxpayer's representative shall furnish written findings of the managed audit to the director. B. The director shall review the written findings and may examine records and perform other reviews that the director deems necessary to verify that the managed a…

A. Notwithstanding section 42-1125, the director shall not assess any penalties unless the managed audit discloses that the taxpayer committed fraud or wilful tax evasion or that the taxpayer collected monies that were represented as tax but were not remitted to the state. B. Not…