43-1021

43-1021. Additions to Arizona gross
income

In computing Arizona adjusted gross income, the following amounts shall be added to
Arizona gross income:

1. A beneficiary's share of the fiduciary adjustment to the extent that the amount
determined by section 43-1333 increases the beneficiary's Arizona gross income.

2. An amount equal to the "ordinary income portion" of a lump sum distribution that
was excluded from federal adjusted gross income pursuant to section 402(d) of the
internal revenue code.

3. The amount of interest income received on obligations of any state, territory or
possession of the United States, or any political subdivision thereof, located outside
the state of Arizona, reduced, for tax years beginning from and after December 31, 1996,
by the amount of any interest on indebtedness and other related expenses that were
incurred or continued to purchase or carry those obligations and that are not otherwise
deducted or subtracted in arriving at Arizona gross income.

4. Annuity income received during the taxable year to the extent that the sum of
the proceeds received from such annuity in all taxable years prior to and including the
current taxable year exceeds the total consideration and premiums paid by the
taxpayer. This paragraph applies only to those annuities with respect to which the first
payment was received prior to December 31, 1978.

5. The excess of a partner's share of partnership taxable income required to be
included under chapter 14, article 2 of this title over the income required to be
reported under section 702(a)(8) of the internal revenue code.

6. The excess of a partner's share of partnership losses determined pursuant to
section 702(a)(8) of the internal revenue code over the losses allowable under chapter
14, article 2 of this title.

7. The amount by which the adjusted basis of property described in this paragraph
and computed pursuant to the internal revenue code exceeds the adjusted basis of such
property computed pursuant to this title and the income tax act of 1954, as
amended. This paragraph shall apply to all property which is held for the production of
income and which is sold or otherwise disposed of during the taxable year, except
depreciable property used in a trade or business.

8. The amount of depreciation or amortization of costs of any capital investment
that is deducted pursuant to section 167 or 179 of the internal revenue code by a
qualified defense contractor with respect to which an election is made to amortize
pursuant to section 43-1024.

9. The amount of gain from the sale or other disposition of a capital investment
which a qualified defense contractor has elected to amortize pursuant to section 43-1024.

10. Amounts withdrawn from the Arizona state retirement system, the corrections
officer retirement plan, the public safety personnel retirement system, the elected
officials' retirement plan or a county or city retirement plan by an employee upon
termination of employment before retirement to the extent they were deducted in arriving
at Arizona taxable income in any year.

11. That portion of the net operating loss included in federal adjusted gross income
which has already been taken as a net operating loss for Arizona purposes or which is
separately taken as a subtraction under the special net operating loss transition rule.

12. Any nonitemized amount deducted pursuant to section 170 of the internal revenue
code representing contributions to an educational institution which denies admission,
enrollment or board and room accommodations on the basis of race, color or ethnic
background except those institutions primarily established for the education of American
Indians.

13. The amount paid as taxes on property in this state with respect to which a
credit is claimed under section 43-1078.

14. Amounts withdrawn from a medical savings account by the individual during the
taxable year computed pursuant to section 220(f) of the internal revenue code and not
included in federal adjusted gross income.

15. Any amount of agricultural water conservation expenses that were deducted
pursuant to the internal revenue code for which a credit is claimed under section
43-1084.

16. The amount by which the depreciation or amortization computed under the internal
revenue code with respect to property for which a credit was taken under section 43-1080
exceeds the amount of depreciation or amortization computed pursuant to the internal
revenue code on the Arizona adjusted basis of the property.

17. The amount by which the adjusted basis computed under the internal revenue code
with respect to property for which a credit was claimed under section 43-1080 and which
is sold or otherwise disposed of during the taxable year exceeds the adjusted basis of
the property computed under section 43-1080.

18. The amount by which the depreciation or amortization computed under the internal
revenue code with respect to property for which a credit was taken under either section
43-1081 or 43-1081.01 exceeds the amount of depreciation or amortization computed
pursuant to the internal revenue code on the Arizona adjusted basis of the property.

19. The amount by which the adjusted basis computed under the internal revenue code
with respect to property for which a credit was claimed under section 43-1074.02, 43-1081
or 43-1081.01 and which is sold or otherwise disposed of during the taxable year exceeds
the adjusted basis of the property computed under section 43-1074.02, 43-1081 or
43-1081.01, as applicable.

20. The deduction referred to in section 1341(a)(4) of the internal revenue code for
restoration of a substantial amount held under a claim of right.

21. The amount by which a net operating loss carryover or capital loss carryover
allowable pursuant to section 1341(b)(5) of the internal revenue code exceeds the net
operating loss carryover or capital loss carryover allowable pursuant to section 43-1029,
subsection F.

22. Any amount deducted pursuant to section 170 of the internal revenue code
representing contributions to a school tuition organization or a public school for which
a credit is claimed under section 43-1089 or 43-1089.01.

23. Any amount deducted in computing Arizona gross income as expenses for installing
solar stub outs or electric vehicle recharge outlets in this state with respect to which
a credit is claimed pursuant to section 43-1090.

24. Any wage expenses deducted pursuant to the internal revenue code for which a
credit is claimed under section 43-1087 and representing net increases in qualified
employment positions for employment of temporary assistance for needy families
recipients.

25. Any amount deducted for conveying ownership or development rights of property to
an agricultural preservation district under section 48-5702 for which a credit is claimed
under section 43-1081.02.

26. The amount of any depreciation allowance allowed pursuant to section 167(a) of
the internal revenue code to the extent not previously added.

27. With respect to property for which an expense deduction was taken pursuant to
section 179 of the internal revenue code, the amount in excess of twenty-five thousand
dollars.

28. The amount of any deductions that are claimed in computing federal adjusted
gross income representing expenses for which a credit is claimed under either section
43-1075 or 43-1075.01 or both.

29. The amount by which the depreciation or amortization computed under the internal
revenue code with respect to property for which a credit was taken under section
43-1090.01 exceeds the amount of depreciation or amortization computed pursuant to the
internal revenue code on the Arizona adjusted basis of the property.

30. The amount by which the adjusted basis computed under the internal revenue code
with respect to property for which a credit was claimed under section 43-1090.01 and
which is sold or otherwise disposed of during the taxable year exceeds the adjusted basis
of the property computed under section 43-1090.01.

31. The amount of a nonqualified withdrawal, as defined in section 15-1871, from a
college savings plan established pursuant to section 529 of the internal revenue code
that is made to a distributee to the extent the amount is not included in computing
federal adjusted gross income, except that the amount added under this paragraph shall
not exceed the difference between the amount subtracted under section 43-1022 in prior
taxable years and the amount added under this section in any prior taxable years.

32. The amount of unemployment compensation that is excluded from federal adjusted
gross income pursuant to section 85(c) of the internal revenue code as added by section
1007 of the American recovery and reinvestment act of 2009 (P.L. 111-5).

33. The amount of discharge of indebtedness income that is deferred and excluded
from the computation of federal adjusted gross income or federal taxable income in the
current taxable year pursuant to section 108(i) of the internal revenue code as added by
section 1231 of the American recovery and reinvestment act of 2009 (P.L. 111-5).

34. The amount of any previously deferred original issue discount that was deducted
in computing federal adjusted gross income or federal taxable income in the current year
pursuant to section 108(i) of the internal revenue code as added by section 1231 of the
American recovery and reinvestment act of 2009 (P.L. 111-5), to the extent that the
amount was previously subtracted from Arizona gross income pursuant to section 43-1022,
paragraph 33.