AZ business partnership tax filings get a bit easier

Your Guide to State, Local, Federal, Estate + International Taxation

tax filings, Arizona, business partnership, AZCurrently, Arizona partnership tax filings with the Arizona Department of Revenue (AZ DOR) must include certain federal forms and schedules to be filed along with the state of Arizona return. An examination of this requirement by the AZ DOR has shown that this can result in an additional 10 to 500 pages per return being required to be submitted. Technology now exists within the AZ DOR to more efficiently query federal tax data without having to rely on submission of federal documents to the state.

So effective with the 2016 tax filings that occur this year in 2017, the AZ DOR will no longer require business partnerships to submit federal Form 1065, federal Schedules K-1 (Form 1065) and all federal supporting schedules with their Arizona partnership income tax return. Taxpayers will still be required to have this supporting documentation available upon request, such as with routine audits. But the change will hopefully save at least some amount of time when filing tax returns as well as printing and postage costs.

Hopefully going forward, the AZ DOR will at some point add partnership returns to their list of state tax returns which can be electronically filed. Currently, the Arizona individual tax return and most forms that may need to accompany it can be filed electronically. Along with some fiduciary, amended and other types of state tax returns. Many Arizona business returns are still excluded from ability to electronically file despite being allowed for the federal tax filing.

Dale F. Jensen, CPA