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Arizona Form 309

2. The other state or country allows Arizona residents

required to file a return with that country, include

credit for taxes paid on income subject to tax by the

documentation showing the amount of tax imposed and

other state or country and Arizona.

paid.

Arizona nonresidents who file resident returns with the

2. If the tax is paid in a foreign currency, a statement

following states qualify for the credit:

substantiating the conversion rate on the date of

payment. Identify your authority for your conversion

California, Indiana, Oregon, and Virginia.

rate.

NOTE: This list is subject to change at any time.

Line-by-Line Instructions

Part-Year Residents

Enter your name and SSN as shown on Arizona Form 140,

For that part of the year you were a resident of Arizona,

Form 140NR, Form 140PY, or Form 140X.

follow the instructions for residents.

Make sure that every return, statement, or document that you

For that part of the year you were an Arizona nonresident,

file with the department has your SSN. Failing to include the

follow the instructions for nonresidents.

proper numbers may subject you or your preparer to a penalty.

Make sure that all of the required identification numbers are

Dual Resident

clear and correct. Your return may take longer to process if

You may be eligible to claim the credit if you are a full-year

identification numbers are missing, incorrect, or unclear.

Arizona resident filing Arizona Form 140 and you are also

If your name appears first on the return, make sure your

considered to be a resident of another state under the laws of

SSN is the first number listed.

that other state. Figure your credit for taxes paid to Arizona

Part 1 - Computation of Income Subject to

and that other state on the same income that is taxable by

Tax by Both Arizona and the Other State

both Arizona and the other state, but only on income that

would be sourced to the other state if you had to report that

or Country During 2014

income as a nonresident.

If you are claiming a credit for income taxes paid to another

You may claim the credit as a dual resident if you meet the

state, enter in the space provided, the two-letter abbreviation

following.

for that state. See the last page of these instructions for a list

of state abbreviations.

1. You are filing a 2014 full-year Arizona resident income

If you are claiming a credit for income taxes paid to another

tax return.

country, enter the name of that country on the line provided.

2. You are considered to be a resident of another state

In order for income to be taxed by both Arizona and another

under the laws of that other state.

state or country, the following must exist.

3. You paid a net income tax to that other state.

For an Arizona resident:

An Arizona resident who is also considered to be a resident

1. The same income must be taxed by both Arizona and

of another state under the laws of that state is allowed a

credit against Arizona income taxes for net income taxes

the other state or country; and

imposed by and paid to that other state if the following

2. The income must have its source within the other state

apply.

or country.

1. The other state taxes the income of the Arizona resident

For a nonresident:

and does not allow the Arizona resident a credit for

taxes imposed on income subject to tax in both Arizona

1. The same income must be taxed by both Arizona and

and the other state.

the other state or country; and

2. The credit is allowed only for taxes imposed on income

2. The income must have its source within Arizona.

that would have been sourced to the other state if the

Lines 1 through 6 -

Arizona resident had filed as a nonresident to the other

Provide a breakdown of your income which is subject to

state.

tax in both Arizona and the other state or country.

If you are an Arizona full-year resident and also

Complete lines 1 through 5 separately for each income

considered to be a resident of another state under the

item listed in columns (a) through (c). If you have more

laws of that other state, complete the Schedule of Income

than three items of income from the other state or country

Allocation, on page 2 of Form 309 before you complete

for which you are claiming the credit, complete additional

page 1 of Form 309.

schedules.

Required Forms

If you are an Arizona resident who is also considered to

be a resident of another state under the laws of that other

If you are claiming a credit for taxes paid to another state,

state, complete the Schedule of Income Allocation, on page

you must include a copy of the tax return filed to the other

2 of Form 309 before you complete Part I, lines 1 through 6

state.

of Form 309.

If you are claiming a credit for taxes paid to a foreign

Line 1 -

country, include the following information with your

Identify the income item from which the income subject to

Arizona income tax return.

tax in both Arizona and the other state or country is

1. A copy of the tax return you filed to the foreign country.

derived. If you have more than one income item, complete

If you are claiming a credit for taxes paid to a foreign

column(s) (b) and (c), as necessary. Examples of such

country for amounts withheld at the source, and are not

income are business income, partnership income, wages, etc.

Arizona Form 309 Instructions - Credit For Taxes Paid To Another State Or Country - 2014 Page 2

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