Arizona Payroll & Paycheck Tax Calculator
Running payroll in the Grand Canyon State shouldn't feel like hiking the desert without water. From Phoenix to Flagstaff, our Arizona Payroll Tax Calculator makes calculating employee withholdings as clear as an Arizona sunrise. Handle state income tax, unemployment insurance, and federal requirements with confidence—all in one simple, powerful tool.
Arizona Payroll Tax Steps
Arizona’s straightforward tax structure might seem like a desert oasis compared to other states, but accuracy still matters when the temperature rises. Our calculator helps you navigate Arizona’s payroll requirements without breaking a sweat, ensuring precise calculations whether you’re in the Valley of the Sun or up in the high country. Skip the guesswork and deliver compliant paychecks every time.
Here are some key steps you’ll have to take to make smarter payroll decisions.
Step #1: Register with Arizona Department of Revenue and DES
Before hiring your first employee in Arizona, you'll need to register with the Arizona Department of Revenue (ADOR) for withholding taxes and the Department of Economic Security (DES) for unemployment insurance. Arizona's online registration through AZTaxes.gov makes the process as smooth as a Sedona red rock. You'll receive separate account numbers for each agency.
New employers pay 2.0% unemployment tax on the first $8,000 of each employee's wages—one of the lower wage bases nationally.
Step #2: Handle Arizona's Streamlined Form Requirements
The Grand Canyon State keeps paperwork relatively simple and straightforward:
- Federal W-4 and Arizona A-4 forms for withholding
- Federal forms from the IRS: • Form 941 (Quarterly federal tax return) • Form 940 (Federal Unemployment Tax, FUTA) • W-2 and 1099 (Year-end wage reporting)
- New Hire Reports: Submit within 20 days to Arizona New Hire Registry
- Workers' Compensation: Required for all employers with employees
- Form A1-QRT: Quarterly withholding tax return
- UC-018: Quarterly unemployment tax and wage report
Arizona keeps things simple with no local income taxes—from Tucson to Tempe, the rules stay consistent.
Step #3: Master Arizona's Minimum Wage and Overtime Laws
Arizona's minimum wage is $14.70 per hour as of 2025, with annual adjustments based on cost of living increases. Tipped employees can be paid $11.70 per hour, with employers ensuring tips bring them to full minimum wage. Small businesses with gross revenues under $500,000 may have different requirements.
For overtime, Arizona follows federal rules precisely: time-and-a-half after 40 hours in a workweek. No daily overtime requirements exist, and weekends or holidays don't automatically trigger overtime unless exceeding 40 weekly hours.
Step #4: Follow Arizona's Pay Period and Leave Requirements
Arizona doesn't mandate specific pay frequencies, allowing employers flexibility in choosing what works best. Most employers opt for weekly, bi-weekly, or semi-monthly pay periods. The key is establishing a regular, predictable schedule.
When employment ends, Arizona requires payment within 7 working days or by the next regular payday, whichever is sooner. If an employee quits, they must receive final wages within 3 working days or the next regular payday.
Arizona mandates earned paid sick time for employers with 15+ employees (up to 40 hours annually). Smaller employers must provide unpaid sick leave. Cities like Tucson may have additional requirements.
Step #5: Use our Simple Arizona Payroll Calculator
Arizona's tax structure is refreshingly straightforward, but our calculator ensures accuracy:
- Federal income tax withholding
- Arizona state income tax (2.5% to 4.5% based on income)
- FICA taxes (Social Security and Medicare)
- Unemployment taxes (FUTA and state UI)
Get instant calculations showing gross pay, all deductions, and net take-home pay—no matter how hot it gets outside.
Step #6: Submit Taxes and File Arizona Payroll Reports
Arizona employers maintain regular filing schedules:
- Quarterly A1-QRT returns for state withholding
- Monthly or quarterly deposits (based on withholding amounts)
- Quarterly UC-018 wage reports for unemployment
- Annual reconciliation (A1-R) by January 31
Your deposit frequency depends on withholding amounts—most small employers file monthly. After two years, unemployment rates adjust based on experience, potentially dropping to 0.08% or rising to 11.80%
Fingercheck and any related entities do not offer tax, accounting, or legal advice. This content is designed for informational purposes only and should not be considered a source of tax, legal, or accounting advice. It is recommended that you consult your tax, legal, and accounting advisors before undertaking any related activities or transactions.