Arizona Paycheck Calculator
Arizona Paycheck Calculator estimates take-home pay from gross wages, subtracting FICA and state withholding, with simple pre-tax deductions included.
Arizona Income Tax Rate
Arizona applies a flat income tax rate of 2.5% for all individual taxpayers starting with the 2023 tax year. This simplified structure replaced Arizona’s former progressive system, which included up to four tax brackets that once reached 4.50%. During 2022, the state briefly used two transitional brackets — 2.55% and 2.98% — before moving to the flat rate. Employers calculate state withholding based on gross taxable wages after pre-tax deductions and the employee’s selected percentage on Form A-4. Arizona does not levy any local income taxes, so employees only see deductions for federal tax, FICA (Social Security and Medicare), and the state 2.5% rate.
| Year | Top Rate / Structure |
|---|---|
| 2016 | 4.54% (graduated brackets) |
| 2017 | 4.54% (graduated brackets) |
| 2018 | 4.50% (graduated brackets) |
| 2019 | 4.50% (graduated brackets) |
| 2020 | 4.50% (graduated brackets) |
| 2021 | 4.50% (graduated brackets) |
| 2022 | 2.98% (two brackets: 2.55% / 2.98%) |
| 2023 | 2.50% flat |
| 2024 | 2.50% flat |
| 2025 | 2.50% flat |
Sources: Arizona Department of Revenue (AZDOR); historical state tax references and 2023 reform updates.
Arizona Median Household Income
Arizona’s median household income has increased steadily over the past decade, reflecting wage growth and population expansion across major cities such as Phoenix, Tucson, and Mesa. Despite minor fluctuations during 2020–2022 due to inflation and pandemic impacts, real income levels rebounded by 2023. The table below shows the real median household income for Arizona, adjusted to 2024 dollars for purchasing power consistency. This data helps residents compare salaries, evaluate cost of living, and assess relocation affordability across Arizona’s metro areas.
| Year | Income |
|---|---|
| 2015 | $67,300 |
| 2016 | $72,900 |
| 2017 | $74,900 |
| 2018 | $76,600 |
| 2019 | $85,650 |
| 2020 | $80,470 |
| 2021 | $81,310 |
| 2022 | $78,300 |
| 2023 | $84,800 |
| 2024 | $84,700 |
Source: U.S. Census Bureau, Real Median Household Income Series (Arizona).
Local Income Taxes in Arizona
Unlike many states, Arizona does not impose local income taxes at the city or county level. That means residents and nonresidents working in Arizona only pay federal and state-level taxes. Employers are not required to withhold any city wage tax, simplifying payroll across metro regions such as Phoenix, Glendale, and Scottsdale.
| Locality | Resident Rate | Nonresident Rate |
|---|---|---|
| All Arizona cities/counties | None | None |
How Your Arizona Paycheck Works
Each paycheck begins with your gross wages for the pay period. Employers subtract any pre-tax deductions such as 401(k) contributions, HSA, or insurance premiums to determine taxable income. Then, federal tax withholding (based on your W-4), FICA contributions, and Arizona state income tax at 2.5% are deducted. Employees select a specific withholding rate (between 0.5% and 3.5%) on their Arizona Form A-4. This amount is withheld from each paycheck and reconciled with your annual tax return. Since Arizona has no city income tax, only federal and state taxes appear on your pay stub.
Arizona Wage and Hour Laws: Overtime and Pay Frequency
Overtime: Arizona follows the Fair Labor Standards Act (FLSA), requiring employers to pay 1.5× the regular hourly rate for hours exceeding 40 in a workweek.
Pay Frequency: State law mandates at least two fixed paydays each month, spaced no more than 16 days apart.
Minimum Wage: Effective January 1, 2025, Arizona’s minimum wage is $14.70 per hour. Employers may pay up to $3.00 less for tipped workers if their earned tips reach the minimum threshold.
FAQs — Arizona Paycheck and Tax Information
How do I use an Arizona paycheck calculator?
Enter your gross pay, pay frequency, filing status, Arizona A-4 rate, and deductions. The calculator estimates your net pay after taxes and pre-tax benefits.
What is Arizona’s state income tax rate?
Arizona uses a flat 2.5% individual income tax rate for 2023 and later tax years.
Did Arizona have two tax brackets in 2022?
Yes. In 2022, the state used two temporary brackets of 2.55% and 2.98% during the transition to a flat rate.
Do Arizona cities levy local income taxes?
No. Arizona cities and counties do not collect any local wage-based income tax.
What does Form A-4 mean for my paycheck?
Form A-4 lets you choose your state withholding percentage (0.5%–3.5%) from taxable wages. Employers use this rate to calculate your state tax each pay period.
Are bonuses taxed differently in Arizona?
No. Arizona taxes bonuses at the same 2.5% state rate. Federal tax may use either the percentage or aggregate method for bonus payments.
What is Arizona’s minimum wage for 2025?
The statewide minimum wage is $14.70 per hour, with a $3.00 tipped credit if the employee’s tips meet or exceed that difference.
How often must I be paid in Arizona?
Employees must be paid at least twice monthly, and paydays cannot be more than 16 days apart.
Do remote workers pay Arizona tax?
Nonresidents pay tax only on Arizona-sourced income. Residents are taxed on all income but may claim credits for taxes paid to other states.
Where can I verify current Arizona tax rates and updates?
Visit the Arizona Department of Revenue (AZDOR) website for the latest Form A-4 instructions and employer withholding tables.