If you have money coming into your bank account in the form of an IRS refund, you should be ready to spend it right away. This means that you need to prepare for the arrival of the money as soon as it lands on your doorstep. You should know about the Arizona State tax refund offset.
If your expected Arizona state tax refund is reduced by the amount of the outstanding debts owed by you and/or your spouse to Arizona tax agencies, the remaining refund you get will be less than what you paid in taxes. This is known as the Arizona state tax refund offset. This is Arizona charitable tax credit something you should consider if you have been receiving a state tax refund for more than a month and if you owe any kind of debt to Arizona tax agencies.
You may be wondering why the Arizona state tax refund offset exists. One reason is because of the unpaid back taxes. If you owe back taxes to Arizona tax agencies, they may want to deduct the money you owe them from your Arizona state income tax refund. It is possible that your bank account balance will be lower than what you expect if you receive a lower Arizona state income tax refund because of the Arizona state tax refund offset.