The Internal Revenue Service (IRS) released a statement stating whether the Child Tax Credit in the state, which was included in the 2023 state budget, is taxable or not.
IRS on Arizona’s Child Tax Credit
The Child Tax Credit was included in the 2023 state budget, and this was heavily pushed by state Republican lawmakers. However, many were disappointed after the Internal Revenue Service released a statement stating that this is taxable.
In a published article in 12News, the Arizona Department of Revenue announced that this will affect more than 740,000 families who were given Child Tax Credit. The rebate was signed into law by Gov. Katie Hobbs in 2023 to help them combat the rising inflation costs.
IRS Classified the CTC as Taxable
According to a published article in FOX10PHOENIX, the Internal Revenue Service classified Arizona’s Child Tax Credit as taxable. This announcement will now force thousands of families to pay on money that many likely thought was free and clear.
Senate President Warren Petersen said, “We haven’t heard the rationale. It doesn’t make sense,” Petersen who supported the Child tax Credit also added that other states had similar tax rebates in 2022 and were not considered taxable by the IRS, so he thought this rebate would be free of taxes as well.
Furthermore, a spokesman for Arizona Attorney General Kris Mayes said that the Attorney General’s office is already looking into it. On the other hand, the office of Governor Katie Hobbs has not yet returned a response or a comment about this matter.