PHOENIX (3TV/CBS 5) - As Arizonans hustled to get their tax filings in before Monday’s deadline, state lawmakers were primed to blow through a tax-related deadline of their own.
“It’s an unfortunate situation that we’re in,” said Republican State Senator J.D. Mesnard. “Obviously, we’ve hit tax day and still don’t have legal conformity with the federal code.”
After Federal tax law changes were approved in 2017, state lawmakers needed to figure out what to do with the extra money set to flow into state coffers.
Some, including many state Democrats and Governor Doug Ducey, wanted to hold onto it. A coalition of Republican lawmakers wanted to give it back to taxpayers.
The clashing plans resulted in gridlock.
So what does this mean for the average Arizona taxpayer? Experts say there are three likely scenarios.
Certified Public Accountant Tom Wheelwright says the first scenario is that lawmakers gavel out this legislative session without changing the state’s tax laws to reflect the federal changes.
“And then we’re good, we’re done,” Wheelwright said.
The second scenario would be if lawmakers reduced the state tax rate.
“And they could reduce the tax rate either retroactively, in which case we’d get a refund, or beginning in 2019,” Wheelwright said.
However, since Arizona income tax is already relatively low, Wheelwright says the average state taxpayer would only be getting back around $100 or so with their second refund.
Wheelwright says the third scenario would involve the state coming into conformity with federal law after tax day.
“In which case we’re talking about potentially amending our tax returns,” Wheelwright said.
But that would be a hassle for both the state and Arizona taxpayers, and some lawmakers say they’d like to avoid it.
“I don’t think there’ll be a scenario where people will have to amend their returns or refile their returns,” Sen. Mesnard said.
Some good news for taxpayers who rushed to file, though uncertainty still remains over what lawmakers will do next.