The Arizona taxable income of a part year individual is calculated as if all income were earned in Arizona. The Federal Adjusted Gross Income (AGI) will be adjusted using the Arizona adjustments to arrive at AGI from all sources. The AGI from all sources is used to determine the taxable income. After the taxable income is calculated, it is prorated using a percentage of the AGI from Arizona sources divided by the AGI from all sources. This prorated tax is the Arizona tax.
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