AZ resident has rental property in TX

Forum|Forum|1 year ago
March 15, 2025
1 reply
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I live in AZ, have a rental property in TX.

When I file the federal tax, my rental income is 25000 but my schedule E is -8000, because of the expense and depreciation. So my question is when I file the AZ tax , should I enter 0 for my rental income or 25000? I don’t see AZ has the option for me to enter expenses and depreciation, or I miss something here?

MAK70

Arizona conforms with the federal tax return- so the income is treated the same as the federal. You do not have to report the information to Arizona, the state looks at your Schedule E from the 1040.

thasildar99

Arizona adjustes the federal income to add the depreciation back which increases the taxable income for Arizona. I have rental properties in Wisconsin and my depreciation was 18,000. Arizona is adding this back to federal AGI which increases my Arizona base. Is that normal? Is there a way to not include the other state depreciation into Arizona income?