Native Americans living and working on
a reservation are allowed to exempt their (reservation) W-2 wages from
Arizona state taxation, under Arizona state law. TurboTax supports this exemption, and here
are the instructions to enter.
- Finish your federal tax return, as your
reservation wages are still taxable by the federal government
- Begin your Arizona state tax return
- When you reach the screen with a list of
items that has the title "Do These Apply to You?" check the one that is labeled "I
Have Adjustments to Federal Income."
-
Continue until you reach "Any Income Adjustments"
- Scroll
down and select "I Am a Native
America Who Earned Wages While Living and Working on a Reservation"
- Click Continue and on the very next
screen you should have the option to enter the dollar amount of your wages that
are eligible for the Arizona exclusion
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