Beginning January 1, 2021, businesses with an annual transaction privilege tax (TPT) and/or use tax liability of $500 or more during the prior calendar year will be required to file and pay electronically starting in February 2021 for the January reporting period.
The revised 2021 threshold of $500 is a change from the 2020 level of $5,000.
Additionally, the following taxpayers must remit their taxes electronically:
- Withholding Tax – Any taxpayer with $125 average quarterly liability for withholding tax during the prior tax year.
- Corporate Estimated Tax – Any corporation with $500 prior tax year liability.
Electronically filing and paying are more secure and faster for taxpayers and critical for ADOR to deliver a more results-driven, customer-focused management system that produces enhanced services for Arizonans.
Businesses failing to file and pay electronically are subject to the following:
- A penalty of 5% of the tax amount due for filing a paper return. The minimum penalty is $25, including filings with zero liability.
- A penalty of 5% of the amount of payment made by check or cash.
- A penalty of 4.5% of the tax required to be shown on the return for each month or fraction of a month the return is late. There is a minimum of $25 and a maximum of 25% of the tax due or $100 per return, whichever is greater.
To file and pay online, a business must be registered on www.AZTaxes.gov and utilizes Automated Clearance House (ACH) Debit, e-check, or credit card as a payment method to comply with electronic funds transfer (EFT) payment requirements.
In 2021, the out-of-state sellers’ economic threshold is $100,000, and accordingly, they are required to file and pay electronically.
For more information on e-services for businesses in Arizona, go tohttps://azdor.gov/e-services/e-services-businesses-arizona.