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Taxes
Arizona Payroll Taxes 2026: Complete Overview for Employers
Arizona flat 2.5% income tax, SUI on $8,000, and all employer obligations.
Practical, accurate resources for Arizona small business owners — covering payroll taxes, labor laws, and compliance. Written by the payroll professionals at Pacific Data Services.
Arizona flat 2.5% income tax, SUI on $8,000, and all employer obligations.
How to register with Arizona Department of Revenue and Industrial Commission of Arizona as a new Arizona employer.
New employer rate 2.0%, experienced range 0.08%–20.60%, wage base $8,000.
Arizona minimum wage is $14.70/hr. Arizona’s minimum wage is $14.70/hr with a $3.00/hr tip credit. The rate adjusts annually for inflation.
Semi-monthly pay required. Final pay: Final wages are due within 7 working days or by the next regular payday, whichever is sooner..
FICA, Social Security, Medicare, FUTA, federal withholding — the complete breakdown.
EIN, state registration, withholding setup, new hire reporting — complete checklist.
IRS classification rules, Arizona-specific considerations, and misclassification penalties.
IRS lookback period, deposit thresholds, next-day rule, EFTPS, and penalties.
Federal and Arizona new hire reporting requirements, deadlines, and penalties.
FLSA, IRS, and Arizona recordkeeping — what to keep, how long, and why.
ALE threshold, penalties, 1094-C/1095-C filing, small business exemption.
Misclassifying workers, wrong withholding, missed deposits — mistakes that add up fast.
Gusto vs Paychex vs QuickBooks vs ADP for Arizona small businesses.
Federal OT after 40 hrs/week, Arizona overtime rules, exemptions, salary thresholds.