Arizona clarification needed

[FEDUKE404]

A part-year resident return for AZ will be filed for 2009.

On the other state and on the federal return, (same) itemized deductions will be used.

For AZ, the time of move and allowable moving expenses lower the AZ AGI significantly.

Is it acceptable to use the standard deduction on the AZ return, even though the other returns are using the Schedule A amounts? (I've seen the reverse explained - using itemized on AZ while the other returns use standard - but cannot find something specific to this question.)

Basically a standard deduction AZ return will result in zero AZ tax liability, and I would like to avoid having to break down the various itemized deductions into AZ/non-AZ amounts using AZ Schedule A(PY).

Thanks in advance!

FE

[PIGLEE]

Just in case you don't have it, here is the link to the AZ Forms and Instructions. http://www.azdor.gov/Forms/Individual.aspx

The form you would use is 140 PY.

Yes, you can use the Standard Deduction on the AZ, and Itemize on the Federal. One thing to consider is that AZ allows you to deduct ALL your medical expense, no 7 1/2% deduction. So it is usually better to itemize on AZ, and go Standard on Federal.

As far as Moving Expenses for AZ please read the following from the instructions. This is from the instructions for line B15.

""""Moving expenses: Enter the amount of moving
expenses included in your federal adjusted gross income
that you accrued and paid during the part of the year
you were an Arizona resident. """"

I have not done research on this in a LONG TIME, but they used to allow the deduction to move INTO AZ, but not OUT of AZ. The wording on the above is not very clear. Sorry I don't have time to do much more research. Hope this helps, but it sounds like you have them to -0- tax anyway.

Jan

[BHoffman]

http://www.azdor.gov/LinkClick.aspx?fileticket=kutTcu-4Q_I%3d&tabid=70&mid=478

See the above ITR. It talks about allocating itemized deductions.

An AZ resident taxpayer is allowed to take the greater of itemized or standard.

If your AZ income tax is zero with or without the itemization, then I'd say you are safe in AZ but might have problems with the other state.

[FEDUKE404]

Thanks for the input

I had already prepared the AZ part-year resident tax return. As stated earlier, my concern (after reading the same sentence way too many times) was whether standard deduction on AZ is OK with accompanying itemized deductions on federal (and the other state). That question has been answered in the affirmative.

As for the moving, most states allow the same moving costs INTO the state as is shown on the federal return. The "logic" I've always used to keep that straight, in addition to the client wanting to know why they can't use their moving expenses for both states, is to consider the Form 3903 amounts to be a "cost" of starting the new job in the new state.

Thanks for the advice on medical expenses. Tax year 2010 should be a full-year AZ return, so I'll see what transpires.

FE