How Arizona taxes a paycheck
Arizona moved from four brackets to a single 2.5% rate for tax year 2023, a year ahead of schedule, after revenue triggers in the 2021 budget were met early. The flat rate applies to all taxable income after a standard deduction that Arizona ties to the federal amount. There is no personal exemption; instead a $100 credit per dependent under 17 ($25 for older dependents) reduces tax directly, phasing out above $200,000 of federal AGI for single filers and $400,000 for couples.
The standard deduction is the one figure on this page to watch. Arizona conforms to the federal deduction as of a fixed date in its statute, and the Tax Foundation's 2026 table shows $8,350 single and $16,700 married, the amount under federal law before the 2025 changes. Arizona has updated its conformity date every year in living memory; if it conforms to the 2026 federal figures of $16,100 and $32,200, Arizona tax falls by about $195 for a single filer. The calculator uses the published figure and this note will change when the state does.
Arizona allows an extra deduction of 34% of what a filer would have claimed in charitable contributions, a quirk that lets standard-deduction filers get some benefit from giving. It is not modelled.
How much taxes are taken out of paychecks in Arizona?
On a $60,000 salary in 2026, a single filer in Arizona pays about $5,020 in federal income tax, $4,590 in Social Security and Medicare, and about $1,290 in Arizona income tax, leaving roughly $49,100 a year or $1,888 every two weeks. The state takes a little over 2% of gross pay, less than half what most taxing states take.
There are no local income taxes anywhere in Arizona. Phoenix, Tucson and every other city fund themselves through sales tax (transaction privilege tax) and property tax, so the state line is the whole state-and-local income tax picture.
Arizona compared with its neighbours
Arizona borders one no-tax state (Nevada) and three that tax wages harder: California at up to 13.3%, New Mexico at up to 5.9%, Utah at a flat 4.5% and Colorado at a flat 4.4%. On a $60,000 salary Arizona's state tax of about $1,290 compares with roughly $1,650 in California (before SDI), $1,930 in Colorado, $1,730 in Utah after its taxpayer credit, and $0 in Nevada.
The gap with California widens quickly with income, because California's 9.3% bracket starts at $72,724 while Arizona stays at 2.5% at every level. At $150,000 a single filer's state tax is about $3,540 in Arizona and about $9,720 in California.
Withholding forms and filing status in Arizona
Arizona employers withhold from Form A-4, which since 2023 lists withholding percentages of 0.5% to 3.5% of gross taxable wages rather than allowances; an employee who does not file one is withheld at 2%. Because the actual rate is a flat 2.5% after the standard deduction, most single earners land close to their year-end liability by choosing 2% or 2.5%, and the calculator's annual figure divided by pay periods shows which is nearer. Married couples get double the standard deduction and the same flat rate, so filing jointly changes little in Arizona beyond the deduction.
Arizona has reciprocal agreements with California, Indiana, Oregon and Virginia: residents of those states who work in Arizona can ask their employer not to withhold Arizona tax. Arizona residents working in Nevada owe Arizona tax on those wages, since Nevada has none to credit.