Arizona Corporate and Pass-Through Entity Estimated Tax Payment

Corporate and Pass-Through Entity Estimated Tax Payment
Booklet 120ES
2 24

Arizona Booklet

120/165ES

Corporate and Pass-Through
Entity Estimated Tax Payment

This booklet contains:
	

	 Form 120/165ES

	

	 Form 120/PTE-W



2023 CORPORATE INCOME TAX HIGHLIGHTS
Electronic Filing of Corporate Income Tax
Returns
Electronic filing of Arizona corporate income tax returns is
required for the 2023 taxable year.
Please see the
department’s website at https://azdor.gov/file-and-pay/e-fileservices/approved-vendors for a list of approved software
vendors.
Any corporate taxpayer who is required to file its income tax
return electronically may apply to the director for an annual
waiver from the electronic filing requirement. The waiver may
be granted if any of the following apply:
• The taxpayer has no computer.
• The taxpayer has no internet access.
• Any other circumstance considered to be worthy by the
director.
Waivers are granted on an annual basis and expire at the end of
the requested tax year. Waivers must be renewed each calendar
year. If a waiver is not renewed, you will be subject to statutory
electronic filing and payment requirements at the expiration of
your waiver.
To request a waiver, submit Form 292, Electronic Filing and
Payment Waiver Application, to the department. Form 292 is
available at: https://azdor.gov/forms/other-forms/electronicfiling-and-payment-waiver-application.
A waiver is not required if the corporation’s income tax return
cannot be electronically filed for reasons beyond the
corporation’s control, including situations in which the
corporation was instructed by either the Internal Revenue
Service or the Arizona Department of Revenue to file by paper.
Please contact the department at [email protected] if you need
assistance in electronically submitting your Arizona corporate
income tax return.

S Corporations and the Pass-Through Entity
Election
For taxable years beginning from and after December 31, 2021
the shareholders of an S Corporation may consent to be taxed at
the entity level in Arizona. The Arizona Pass Through Entity
(PTE) income tax is assessed at a rate of 2.5% of the income
attributable to the S Corporation’s resident shareholders and the
income derived from sources within Arizona attributable to the
nonresident shareholders.
This election must be made by the S Corporation no later than
the due date or extended due date of its return. Shareholders
that are not individuals or estates and trusts may not participate
in this election. Shareholders who are individuals or estates and
trusts who opt out of this election also may not participate in
this election.
For additional information, see the instructions for Form 120S.

Electronic Funds Transfer
Corporations are required to pay their tax liability by electronic
funds transfer (EFT) if the corporation’s tax liability is $500 or
more for any taxable year beginning from and after December
31, 2020.
A corporation may apply to the director for an annual waiver
from the electronic payment requirement. The application must
be received by December 31 of each year. The director may
grant the waiver if any of the following applies:
• The corporation has no computer.
• The corporation has no internet access.
• Any other circumstance considered to be worthy by the
director exists, including:
o The corporation has a sustained record of timely
payments and
o The corporation has no delinquent tax account with
the departnemt.
To request a waiver, submit Form 292, Electronic Filing
and Payment Waiver Application, to the department.
Form 292 is available at: https://azdor.gov/forms/otherforms/electronic-filing-and-payment-waiver-application.
o

NOTE: A corporation who is required to pay by EFT but
who fails to do so is subject to a penalty of 5% of the amount
of the payment not made by EFT. See A.R.S. § 42-1125(O).
For additional information on electronic funds transfer, refer
to A.R.S. § 42-1129 and the related Arizona Administrative
Code rules (A.A.C. R15-10-301 through R15-10-307) for
detailed information.

Extension of Time to File a Return
Effective for taxable years beginning after December 31, 2020
the department may grant an extension request for a maximum
of 7 months to a C corporation:
• That has a valid federal extension.
• That filed an Arizona extension request on Arizona
Form 120EXT.
NOTE: The maximum length of time for an extension granted
to an S Corporation remains 6 months.

Inclusion of Federal Return with Arizona return
The department requests that taxpayers include a copy of their
“as-filed” federal return (i.e. federal Form(s) 1120, 1120-S,
1120-F, etc.) and all its schedules and attachments with their
Arizona return.

2023 Corporate Income Tax Highlights

Changes to Tax Credits

Tax Credits Repealed

Arizona Credit for Increased Research Activities

The Military Reuse Zone Credit, claimed on Form 306, has
expired and is no longer available to taxpayers for taxable years
beginning from and after December 31, 2022.
The Credit for Solar Hot Water Heater Plumbing Stub Outs
and Electric Vehicle Recharge Outlets, claimed on Form 319,
has expired and is no longer available to taxpayers for taxable
years beginning from and after December 31, 2022.

For taxable years beginning from and after December 31, 2022,
Arizon will permit taxpayers to compute the Credit for
Increased Research Activities using:
• The regular method – the excess of Arizona qualified
research expenses for the taxable year over the base
amount and the Arizona basic research payments; or,
• The Alternative Simplified Credit – the excess of
Arizona qualified research expenses for the taxable year
over the average Arizona qualified research expenses
for the previous three years.
See the instructions for Form 308 for additional information.

New Tax Credit
Credit
for
Motion
Picture
Production
Costs,
A.R.S. §§ 43-1082 and 43-1165 provide that an individual or
corporate refundable tax credit is allowed against production
costs that are subject to taxation in Arizona and that are directly
attributable to a motion picture production in Arizona. The
credit is claimed on Form 334. S Corporations may claim this
credit at the corporate level or they may pass the credit through
to their shareholders.

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Arizona Form

120/165ES

Corporate and Partnership Estimated Tax Payment

2024

To ensure proper application of this payment, this form must be completed in its entirety.
For the  calendar year 2024 or  fiscal year beginning M M D D 2 0 2 4 and ending M M D D 2 0 Y Y .
Name of Firm – exactly as it will appear on the return	

Employer Identification Number (EIN)

Address – number and street or PO Box	

Business Phone Number (with area code)

1
2
Address – continued

REVENUE USE ONLY. DO NOT MARK IN THIS AREA

88

2
City	

State	

ZIP Code

3
A

	

Check if this is the first tax return filed under this name and EIN.

B

	

Check if name and/or address has changed.

C

	

Check if EIN has changed. Enter prior EIN:	

	 1	 Payment is for quarter number:	

81 PM

80 RCVD

 Qtr 1................  Qtr 2..............  Qtr 3..............  Qtr 4

	 2	 Payment: Round estimated payment to a whole dollar (no cents).
		 Enter the amount of payment enclosed........................................................................................	
	
	 Make check payable to Arizona Department of Revenue.
	
	 Include EIN on payment.
	
	 Mail to Arizona Department of Revenue, PO Box 29085, Phoenix, AZ 85038-9085.

$	

00

General Instructions
Obtain additional information or assistance by calling one of
the numbers listed below:

Pass-Through Entity (PTE) Election

Phoenix...........................................................	 (602) 255-3381
From area codes 520 and 928, toll-free..........	 (800) 352-4090

Partnerships and S Corporations making the PTE election whose
taxable income for the previous year exceeds $150,000 are required
to make Arizona estimated tax payments.

Obtain tax rulings, tax procedures, tax forms and instructions,
and other tax information by accessing the department’s
website at www.azdor.gov.

S Corporations subject to tax at the federal level and making
the PTE election for the same taxable year must:

Who is Required to Make Estimated Tax Payments
C corporations, S Corporations subject to tax at the federal
level and exempt organizations with unrelated business taxable
income that anticipate an Arizona tax liability for the year of at
least $1,000 are required to make Arizona estimated payments.
	 •	 A unitary group of corporations filing a combined return on
Form 120 must make Arizona estimated tax payments on
a combined basis. Therefore, a unitary group, as a single
taxpayer, must make estimated tax payments if its Arizona
tax liability for the taxable year is at least $1,000.
	•	 An Arizona affiliated group filing an Arizona consolidated
return pursuant to A.R.S. § 43‑947 on Form 120 must make
Arizona estimated tax payments on a consolidated basis.
Therefore, an Arizona affiliated group, as a single taxpayer,
must make estimated tax payments if its Arizona tax liability
for the taxable year is at least $1,000.

ADOR 10339 (23)

	 •	 Make Arizona estimated tax payments if their total taxable
income for the previous year exceeds $150,000.
	 •	 Total their separately calculated estimated payments for the
corporate tax liability and the PTE tax liability to compute
their total required estimated payments.
	 •	 Make the required estimated payments on or before the 15th
day of April, June, and September of the taxable year, and
January 15th of the following year.
Composite Returns
Partnerships and S corporations must use Form
140ES to make voluntary estimated tax payments on
a composite basis on behalf of nonresident individual
shareholders or nonresident individual partners participating
in the filing of a composite return on Arizona Form 140NR
Refer to the department’s ruling, ITR 16-2, Composite Individual
Income Tax Returns, for additional information regarding
composite returns. For additional information, see Form 140NR
instructions for completing a composite return.

Arizona Form 120/165ES
Who Should Use Arizona Form 120/165ES

Recomputing Required Installments of Estimated
Tax

Taxpayers for whom the Director has granted a waiver from the
electronic payment requirement.

If the taxpayer, after paying one or more required installments
of Arizona estimated tax, finds that its tax liability for the taxable
year will be more or less than originally estimated, the taxpayer
should recompute its required installments. If earlier installments
were underpaid, the taxpayer may be subject to a penalty for
underpayment of estimated tax.

Taxpayers whose anticipated tax liability for the year is less
than $500 that wish to make Arizona estimated payments
may complete this form and mail the form and payment to the
address above.

When to Make Estimated Tax Payments

If a new estimate is made, the required installments payable
on or after the date of the new estimate should be adjusted. An
immediate “catch-up” payment should be made to reduce the
amount of any penalty resulting from the underpayment of any
earlier installments, whether caused by a change in estimate,
failure to make a payment, or a mistake.

Calendar year and fiscal year basis corporate taxpayers
are required to make their Arizona corporate estimated tax
payments by the 15th day of the 4th, 6th, 9th, and 12th months
of the taxable year. If the payment due date falls on a weekend
or legal holiday, the payment is considered timely if made on the
next business day.

Estimated Tax Payments by Electronic Funds
Transfer (EFT)

Partnerships and S Corporations making the PTE election are
required to make their estimated payments by the 15th day
of the 4th, 6th, and 9th months of the taxable year. The final
payment is due by the 15th day of the 1st month following the
close of the taxable year. If the payment due date falls on a
weekend or legal holiday, the payment is considered timely if
made on the next business day.

Refer to Arizona Revised Statutes § 42‑1129 and the related
Arizona Administrative Code R15‑10-301 through R15‑10‑307
for detailed information regarding EFT.
Taxpayers anticipating a tax liability for the current year of at
least $1,000 must make Arizona estimated tax payments by
EFT.

S Corporations having a tax liability at the federal level and that
are making the Arizona PTE election must make their estimated
payments by the 15th day of the 4th, 6th, and 9th months of the
taxable year. The final estimated payment is due by the 15th
day of the 1st month following the close of the taxable year. If
the payment due date falls on a weekend or legal holiday, the
payment is considered timely if made on the next business day.

Taxpayers that anticipate a tax liability for the current year of
more than $500 but less than $1,000 are not required to make
Arizona estimated tax payments. If the taxpayer elects to make
Arizona estimated tax payments, it is required to make those
payments by EFT.
NOTE: Taxpayers required to make Arizona estimated tax
payments via EFT that fail to do so will be subject to a
penalty of 5% of the amount of the payment not made by
EFT. See A.R.S. § 42‑1125(O).

Computation of Required Installments of Estimated
Tax on Arizona Form 120/PTE-W
Taxpayers should use Form 120/PTE-W, Estimated Tax
Worksheet for Corporations, to compute the amount of the
required installments of estimated tax.

Taxpayers required to make Arizona estimated tax payments
via EFT must complete the department’s EFT authorization
agreement at least 30 days prior to initiation of the first applicable
transaction.

Underpayment of Required Installments of
Estimated Tax
If the taxpayer is required to make Arizona corporate estimated
tax payments, a penalty will be imposed on any required
installment that is late or underpaid. See A.R.S. § 42‑1125(Q).

Taxpayers who anticipate their Arizona income tax liability for
the 2024 taxable year to be less than $500 may elect voluntary
participation in the EFT program. Voluntary participants in the
program must complete the department’s EFT authorization
agreement at least 30 days prior to the first applicable
transaction.
DO NOT submit Form 120/165ES to the department if the
taxpayer makes its Arizona estimated tax payments by EFT.

ADOR 10339 (23)

2

Arizona Form 120/165ES
Estimated Tax Payments via the Internet

Completing Arizona Form 120/165ES

Taxpayers wishing to make EFT payments via the Internet are no
longer required to register with the department before their EFT
payments may be accepted. Visit AZTaxes.gov, go to “Make a
Corporation/S-Corporation/Partnership Payment” and follow the
prompts to choose a payment type and make a payment.

Complete Form 120/165ES in its entirety to ensure the proper
application of the estimated tax payment.

DO NOT submit Form 120/165ES to the department if the
taxpayer makes its Arizona estimated tax payments over the
Internet.

	 •	 Taxpayer name, address and employer identification number
(EIN) as it will appear on the tax return. If the taxpayer has a
foreign address, enter the information in the following order:
city, province or state, and country. Follow the country’s
practice for entering the postal code. Do not abbreviate the
country’s name.

Enter the following information on Form 120/165ES:
	 •	 The period covered by the taxable year;

Electronic payment from checking or savings account
Arizona estimated tax payments can be made electronically from
a checking or savings account. Visit www.AZTaxes.gov, click
“Make a Corporation/S-Corporation/Partnership Payment”, follow
the prompts and choose the e-check option. There is no fee to
use this method. This payment method will debit the amount from
the specified checking or savings account on the date specified.
When an electronic payment is made from a checking or
savings account, a confirmation number will be generated.
Please keep this confirmation number as proof of payment.

	 •	Check the box on line 1 indicating the quarter for which the
payment is to be applied;
	 •	Enter the amount of the estimated tax payment (in whole
dollars) on line 2.
Check the appropriate box:
	 •	If the taxpayer will file an initial return under the name and
EIN listed, check box “A”.

Credit card payment

	 •	If the taxpayer’s name or address has changed, check box
“B”.

Arizona estimated tax payments can be made by American
Express, Discover, MasterCard or Visa credit cards. Visit
www.AZTaxes.gov, click “Make a Corporation/S-Corporation/
Partnership Payment”, follow the prompts and choose the credit
card option. This will take you to the web site of the credit card
payment service provider. The service provider will charge a
convenience fee based on the amount of the tax payment. The
service provider will disclose the amount of the convenience fee
during the transaction and the option to continue or cancel the
transaction will be presented. If you accept the convenience
fee and complete the credit card transaction, a confirmation
number will be generated. Please keep this confirmation
number as proof of payment.

ADOR 10339 (23)

	 •	If the taxpayer’s EIN has changed, check box “C”. Indicate
the previous EIN in the space provided.

Rounding Dollar Amounts
Taxpayers must round amounts to the nearest whole dollar. If 50
cents or more, round up to the next dollar. If less than 50 cents,
round down.

3

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Arizona Form

120/PTE-W

Estimated Tax Worksheet for Corporations & Pass-Through Entities

2024

(Taxpayers Filing Forms 99T, 120, 120A, 120S & partnerships & S Corporations making the PTE election)

NOTE: Partnerships or S Corporations making the Pass-Through Entity (PTE) election, check here
See instructions before proceeding..
	1	 Arizona tax liability: See instructions before completing this line....................................................................................................	
	 2	 Required annual payment:
		a	 Enter 90% of line 1...................................................................................................................... 	
		b	 C corporations and exempt organizations: Enter the tax as shown on the 2023 return..................... 	
		c	 S Corporations subject to tax at the federal level: See instructions.................................................. 	
		d Partnerships and S Corporations making the PTE election: See instructions................................. 	

	 3	 Installment due dates: See instructions.............................

	3

1	00

2a	00

2b	00

2c	00

2d	00

		e	 All taxpayers: See instructions......................................................................................................................................................	

(a)

.

2e	00

Required Installments – Due Dates and Amounts

MM D D Y Y

(b)

(c)

(d)

MM D D Y Y

MM D D Y Y

MM D D Y Y

	4	 Required installments: Enter 25% of line 2e in columns (a)
through (d) unless the taxpayer uses the annualized income installment
method, the adjusted seasonal installment method, or is a “large
corporation”. See instructions............................................................

SCHEDULE A
Part 1

	4

Required Installments Using the Annualized Income or Adjusted Seasonal Installment Methods
Under IRC § 6655(e)
Annualized Income Installment Method (Available to partnerships or S Corporations making the PTE election.)

	 5	 Annualization periods: See instructions...................................

	5

	 6	 Enter taxable income for each annualization period...............

	6

	7	 Annualization amounts: See instructions.................................

	7

	8	 Annualized taxable income: Multiply line 6 by line 7. Enter result...

	8

First

(a)

Months

First

(b)

Months

First

(c)

Months

First

(d)

Months

	9	 Multiply the amount in each column on line 8 by 4.9%:
Enter the result. (PTE’s use 2.5% as tax rate.)....................

	9

	10	 Enter tax from recapture of tax credits for each payment
period: See instructions.........................................................

	10

	11	 Subtotal tax: Add lines 9 and 10. Enter the total.........................

	11

	12	 For each period, enter the amount of nonrefundable tax
credits: See instructions........................................................
	13	 Arizona tax liability:

Subtract line 12 from line 11.

	12

Enter the

difference. If zero or less, enter “0”............................................

	13

	14	 Refundable tax credits: See instructions.................................

	14

	15	 Claim of right adjustment: See instructions.............................

	15

1
	 6	 Net liability: Subtract the sum of line 14 and line 15 from line 13.
Enter the difference. If zero or less, enter “0”...............................

	16

	17	 Applicable percentage.........................................................

	17

	18	 Multiply line 16 by line 17. Enter the result..............................

	18

22.5%

45%

67.5%

90%

	19	 Add the amounts in all preceding columns from page 2,
Part 3, line 52: See instructions.............................................
	20	 Annualized income installments:

line 18. Enter the difference. If zero or less, enter “0”......................

Part 2

	19

Subtract line 19 from

	20

Adjusted Seasonal Installment Method

(Not available to partnerships or S Corporations making the PTE election.)

CAUTION: Use this method only if the base period percentage of any 6 consecutive months is at least 70%. See the instructions for more information.

(a)
First 3 Months

	21	 Enter taxable income for the following periods:
	

a	 Taxable year beginning in 2021........................................

	21a

	

b	 Taxable year beginning in 2022........................................

	21b

	

c	 Taxable year beginning in 2023........................................

	21c

(b)
First 5 Months

(c)
First 8 Months

(d)
First 11 Months

	22	 Enter taxable income for each period for taxable year
beginning in 2024...............................................................

	22
Continued on page 2 

ADOR 10551 (23)

	23	 Enter taxable income for the following periods:
	

a	 Taxable year beginning in 2021........................................

	23a

	

b	 Taxable year beginning in 2022........................................

	23b

	

c	 Taxable year beginning in 2023........................................

	23c

(a)
First 4 Months

(b)
First 6 Months

(c)
First 9 Months

(d)
Entire Year

(a)
First Installment

(b)
Second Installment

(c)
Third Installment

(d)
Fourth Installment

	24	 Divide the amount in each column on line 21a by the amount
in column (d) on line 23a. Enter the result...............................

	24

	25	 Divide the amount in each column on line 21b by the amount
in column (d) on line 23b. Enter the result...............................

	25

2
	 6	 Divide the amount in each column on line 21c by the amount
in column (d) on line 23c. Enter the result...............................

	26

	27	 Add lines 24 through 26. Enter the total..................................

	27

	28	 Divide line 27 by three (3). Enter the result.............................

	28

2
	 9	 Divide line 22 by line 28. Enter the result................................
3
	 0	 Multiply the amount in each column on line 29 by 4.9%:

	29

PTEs use 2.5% Enter the result. ............................................
	31	 Divide the amount in each column on line 23a by the amount

	30

in column (d) on line 23a. Enter the result...............................
	32	 Divide the amount in each column on line 23b by the amount

	31

in column (d) on line 23b. Enter the result...............................

	32

3
	 3	 Divide the amount in each column on line 23c by the amount
in column (d) on line 23c. Enter the result...............................
	34	 Add columns (a) through (c) of lines 31 through 33.

	33

Enter the total.......................................................................

	34

	35	 Divide columns (a) through (c) of line 34 by three (3).
Enter the result.....................................................................

	35

	36	 Multiply the amount in columns (a) through (c) of line 30 by the
amount in the corresponding column of line 35. Enter the result.
In column (d), enter the amount from line 30, column (d).....

	36

	37	 Enter tax from recapture of tax credits for each payment
period: See instructions.........................................................

	37

	38	 Subtotal tax: Add lines 36 and 37. Enter the total........................

	38

3
	 9	 For each period, enter the amount of nonrefundable tax
credits: See instructions........................................................
	40	 Arizona tax liability:

	39

Subtract line 39 from line 38. Enter the

difference. If zero or less, enter “0”.............................................

	40

	41	 Refundable tax credits: See instructions.................................

	41

	42	 Claim of right adjustment: See instructions.............................

	42

4
	 3	 Net liability: Subtract the sum of line 41 and line 42 from line 40.
Enter the difference. If zero or less, enter “0”................................

	43

	44	 Multiply line 43 by 90%. Enter the result.................................

	44

4
	 5	 Add the amounts in all preceding columns from Part 3,
line 52: See instructions........................................................

	45

	46	 Adjusted seasonal installments: Subtract line 45 from line
44. Enter the difference. If zero or less, enter “0”...........................

Part 3

Required Installments

	46

	47	 If only one of the above parts is completed, enter the amount
in each column from line 20 or line 46. (If both parts are
completed, enter the lesser of the amounts in each column
from line 20 or line 46.)......................................................
	48	 Enter 25% of line 2e in each column.

	47
	

		NOTE: “Large corporations”, see instructions for line 4 to
determine the amount to enter............................................

48

	49	 Enter the amount from line 51 of this schedule for the
preceding column...............................................................

	49

	50	 Add lines 48 and 49. Enter the total.......................................

	50

	51	 If line 50 is more than line 47, subtract line 47 from line 50.
Otherwise, enter “0”...........................................................

	51

	52	 Required Installments: Enter the lesser of line 47 or line 50
here and on page 1, line 4........................................................

ADOR
	
10551 (23)

	52

AZ Form 120/PTE-W (2023)

Page 2 of 2

2024 Estimated Tax Worksheet for
Corporations & Pass-Through Entities

Arizona Form
120/PTE-W

• The 15th day of the 9th month of the taxable year; and,
• The 15th day of the 12th month of the taxable year.
Estimated tax payments for partnerships and S Corporations
making the PTE election are due on or before:
• The 15th day of the 4th month of the taxable year;
• The 15th day of the 6th month of the taxable year;
• The 15th day of the 9th month of the taxable year; and,
• The 15th day of the 1st month following the close of the
taxable year.

For information or help, call one of the numbers listed:
Phoenix
(602) 255-3381
From area codes 520 and 928, toll-free
(800) 352-4090
Tax forms, instructions, and other tax information
If you need tax forms, instructions, and other tax information,
go to the department’s website at www.azdor.gov.
Income Tax Procedures and Rulings
These instructions may refer to the department’s income tax
procedures and rulings for more information. To view or
print these, go to our website and select Reports & Legal
Research. On the next page, click on Legal Research. Select
a Document Type and a Category from the drop down menus.
If you know the document ID number you may enter it in the
Search field and then press enter.
Publications
To view or print the department’s publications, go to our
website, scroll down, click on Reports & Legal Research, and
click on Publications in the right hand column.

Calculating the Annual Required Payment

Corporations and Exempt Organizations with UBTI
For corporations and exempt organizations with UBTI, the
anticipated amount of the annual estimated payment is the
lesser of:
• Ninety percent (90%) of the tax shown on the return for
the current taxable year, or,
• One hundred percent (100%) of the tax shown on the
corporation’s return for the preceding taxable year,
unless:
o The preceding taxable year was not a taxable year of
12 months
o The corporation did not file a return for the
preceding taxable year showing a liability for tax.
Large Corporations
Large corporations 1 must make an annual estimated tax
payment equal to ninety percent (90%) of the tax shown on
the return for the current taxable year. If the large
corporation reduces its first installment payment, that amount
must be recaptured by increasing the amount of the next
installment payment by the amount of the reduction.
S Corporations subject to tax at the federal level and NOT
making the PTE Election
For S Corporations the anticipated amount of the required
annual payment for an S Corporation is the lesser of:
• Ninety percent (90%) of the tax shown on the return for
the current taxable year, or
• The sum of:
o Ninety percent (90%) of the amount of current year
tax shown on the return for the taxable year
attributable to built-in gains income or certain
capital gains income, plus,
o One hundred percent (100%) of the tax liability
attributable to excess passive income on the return
for the preceding taxable year.

General Instructions
Who Is Required To Make Arizona Estimated Tax
Payments
C corporations, exempt organizations with unrelated
business taxable income (UBTI), and S Corporations
subject to tax at the federal level that anticipate a tax
liability of at least $1,000 for the taxable year are
required to make Arizona estimated tax payments.
o A unitary group of corporations filing a combined
return on Arizona Form 120 must make estimated
tax payments on a combined basis. Therefore, a
unitary group, as a single taxpayer, must make
estimated tax payments if its Arizona tax liability for
the taxable year is at least $1,000.
o An Arizona affiliated group filing an Arizona
consolidated return on Arizona Form 120 must
make estimated tax payments on a consolidated
basis. Therefore, an Arizona consolidated group, as
a single taxpayer, must make estimated tax
payments if its Arizona tax liability for the taxable
year is at least $1,000.
• Partnerships and S Corporations making the PassThrough Entity (PTE) election to pay Arizona income
tax at the entity level must make Arizona estimated tax
payments if their taxable income from the previous year
exceeds $150,000.
Complete Arizona Form 120/PTE-W to compute the required
annual payment of estimated tax and the required
installments.
•

When to Make Estimated Tax Payments

Estimated tax payments for C corporations, exempt
organizations with UBTI, and S Corporations subject to tax at
the federal level are due on or before:
• The 15th day of the 4th month of the taxable year;
• The 15th day of the 6th month of the taxable year;

A “Large Corporation” is defined as: “… a corporation or
unitary group of corporations if the corporation, or a
predecessor corporation, had federal taxable income of $1
million or more for any of the immediately preceding 3
taxable years, excluding any federal net operating loss or
capital gains carryback or carryovers.” A.R.S § 43-582(C).
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Arizona Form 120/PTE-W
Installment Due Dates
The due dates for the required payment of estimated taxes for
a C corporation, exempt organization with UBTI, or an S
Corporation subject to tax at the federal level, are:
• The 15th day of the 4th month of the taxable year;
• The 15th day of the 6th month of the taxable year;
• The 15th day of the 9th month of the taxable year; and,
• The 15th day of the 12th month of the taxable year.
If the corporation’s taxable year begins on a date other than
January 1, the installment payments are due during the
months that correspond to the prescribed months of the
calendar year.
If the due date for a payment falls on a Saturday, Sunday, or
legal holiday, the payment is considered timely if it is made on
the next business day. (See GTR 16-2, Timely Filing of Income
or Withholding Tax Return – Holidays and Weekends.)
Penalties
If a Corporation fails to pay the full amount of estimated tax,
or any required installment, the corporation is subject to a
penalty prescribed by ARS 42-1125(Q). For purposes of this
paragraph:
• The amount of underpayment is the excess of the
required installment over the amount, if any, of the
installment paid on or before the due date of the
payment.
• A payment of estimated tax shall be credited against
unpaid required installment payments in the order in
which the installments are required to be paid.

NOTE: The requirement that an S Corporation’s return for
the previous taxable year show a tax liability related to
excess passive income does not apply.
If the S Corporation’s preceding taxable year had fewer than
12 months, it may not calculate its annual estimated payment
on the tax attributable to built-in gains, certain capital gains
income, or excess passive income reported on the return for
the previous taxable year.
Partnerships and S Corporations making the PTE Election
Partnerships and S Corporations making the PTE election
must make estimated tax payments if their Arizona taxable
income for the previous year exceeds $150,000. The amount
of the payments must be an amount that reasonably reflects
the PTE’s Arizona income tax liability that will be unpaid at
the end of the year. The amount due must be paid in 4 equal
installments on or before the due dates indicated above, and
shall total:
• At least ninety percent (90%) of the tax due for the
current taxable year, or,
• One hundred percent (100%) of the tax due for the
previous taxable year.
S Corporations subject to tax at the federal level AND are
making the PTE Election
S Corporations subject to tax at the federal level AND that
are making the PTE election must separately compute their
required minimum payments for the income generating the
federal tax liability and the income generating the PTE tax
liability.

Partnerships and S Corporations Making the PTE
Election
For partnerships and S Corporations making the PTE
election, the total of the payments of estimated tax must be an
amount that reasonably reflects the PTE’s Arizona income
tax liability at the end of the taxable year. The payments must
total:
• At least ninety percent (90%) of the tax due for the
current year, or,
• One hundred percent (100%) of the tax due from the
preceding taxable year.

NOTE: Compute the minimum payment for the income
generating the federal tax liability using the corporate tax
rate, 4.9% and the due dates for the PTE required payments.
Compute the required minimum payment for the income
generating the PTE tax liability using the PTE tax rate, 2.5%
and the due dates for the PTE required payments.

Installment Payments and Due Dates
Corporate Installment Payments
For all corporations (C corporations, exempt organizations
with UBTI, and S Corporations subject to tax at the federal
level NOT making the PTE election), four installments of
estimated tax are required for each taxable year. Unless
otherwise prescribed, the amount of each installment is
twenty five percent (25%) of the required annual payment. A
lower required installment payment, as established by section
6655 of the internal revenue code, applies if the lower
installment is less than twenty five percent (25%) of the
required annual payment.
In addition to the standard method of calculating the
installment payments, corporations also may calculate their
installment payment by:
• The Annualized Income Installment Method, or,
• The Adjusted Seasonal Installment Method.

PTE Installment Payments
Four payments of estimated tax are required for each taxable
year.
Partnerships and S Corporations making the PTE election,
may also calculate their required installment payment using
the Annualized Income Installment Method, if the partnership
or S Corporation qualifies to use this method.
PTE Installment Due Dates
The due dates for each installment of the required payment of
estimated tax are:
• The 15th day of the 4th month of the taxable year;
• The 15th day of the 6th month of the taxable year;
• The 15th day of the 9th month of the taxable year; and,

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Arizona Form 120/PTE-W
Penalties
If the S Corporation does not pay the estimated tax required
on or before the prescribed dates, a penalty shall be assessed
on the unpaid amount. (See A.R.S. § 42-1125(Q).) Penalties
or interest shall not be assessed or collected if either of the
following applies:
• The estimated tax payments are allowable exceptions
under section 6654 of the internal revenue code; or,
• The Arizona income tax liability due on the return is less
than $1,000.

The 15 of the 1 month following the close of the
taxable year.
• The tax rate is 2.5% of Arizona taxable income.
If the due date for a payment falls on a Saturday, Sunday, or
legal holiday, the payment is considered timely if it is made on
the next business day. (See GTR 16-2, Timely Filing of Income
or Withholding Tax Return – Holidays and Weekends.)
Penalties
If the partnership or S Corporation making the PTE election
does not pay the estimated tax required on or before the
prescribed dates, a penalty shall be assessed on the unpaid
amount. (See A.R.S. § 42-1125(Q).) Penalties or interest
shall not be assessed or collected if either of the following
applies:
• The estimated tax payments are allowable exceptions
under section 6654 of the internal revenue code; or,
• The Arizona income tax liability due on the PTE’s return
is less than $1,000.
S Corporations Subject to tax at the Federal Level AND
Making the PTE Election
S Corporations subject to tax at the federal level and that are
making the PTE election must:
• Separately compute the required minimum payment for
the income generating the federal tax liability using the
corporate tax rate, 4.9%.
• Separately compute the required minimum payment for
the income generating the PTE tax liability using the
PTE tax rate, 2.5%.
• Total those amounts. This is the total required minimum
payment due for each quarter. Enter these amounts in
the corresponding quarter of Form 120/PTE-W.
The payments must total:
• At least ninety percent (90%) of the tax due for the
current year, or,
• One hundred percent (100%) of the tax due from the
preceding taxable year.
Installment Payments
Four payments of estimated tax are required for each taxable
year.
The S Corporation may also calculate its required installment
payment using the Annualized Income Installment Method if
it qualifies to use this method.
Installment Due Dates
The due dates for each installment of the required payment of
estimated tax are:
• The 15th day of the 4th month of the taxable year;
• The 15th day of the 6th month of the taxable year;
• The 15th day of the 9th month of the taxable year; and,
• The 15th of the 1st month following the close of the
taxable year.
If the due date for a payment falls on a Saturday, Sunday, or
legal holiday, the payment is considered timely if it is made on
the next business day. (See GTR 16-2, Timely Filing of Income
or Withholding Tax Return – Holidays and Weekends.)
•

th

st

Making Estimated Tax Payments

Taxpayers 2 making estimated payments for 2024 that expect
a 2024 income tax liability of $500 or more must make
Arizona estimated payments using EFT. See the Section
Payment by Electronic Funds Transfer, below, for details on
making tax payments by EFT.
NOTE: Taxpayers that make estimated tax payments by EFT
should not submit Arizona Form 120/165ES.
Taxpayers making estimated payments for 2024 who expect a
2024 income tax liability of less than $500 may pay by check,
e-check, money order, credit card, or they may elect to
participate in EFT. See the Section, Payment by Electronic
Funds Transfer, below, for additional information. If paying
by check or money order, complete Arizona Form 120/165ES
and include the check or money order with the form.
NOTE: Taxpayers required to make estimated payments by
EFT that fail to do so are subject to a penalty of five percent
(5%) of the amount of the payment not made by EFT. See
A.R.S. § 42-1125(O).
For additional information on electronic funds transfer, refer
to A.R.S. § 42-1129 and the related Arizona Administrative
Code rules (A.A.C. R15-10-301 through R15-10-307).

Rounding Dollar Amounts
Taxpayers must round amounts to the nearest whole dollar. If
50 cents or more, round up to the next dollar. If less than 50
cents, round down.
NOTE: If two or more amounts must be added to figure the
amount to enter on a line, include cents when adding the
amounts. Round only the total.

Payment by Electronic Funds Transfer
Corporations are required to pay their tax liability by
electronic funds transfer (EFT) if the corporation owes $500
or more for any taxable year beginning from and after
December 31, 2020.
A corporation may apply to the director for an annual waiver
from the electronic payment requirement. The application
must be received by December 31 of each year. The director
may grant the waiver if any of the following applies:
• The corporation has no computer.
• The corporation has no internet access.
For purposes of these instructions, “taxpayer” refers to C
corporations, exempt organizations with UBTI, S
Corporations subject to tax at the federal level, or
partnerships or S Corporations making the PTE election.

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Arizona Form 120/PTE-W
transaction, a confirmation number will be
generated. Please keep this confirmation number as
proof of payment.

Any other circumstance considered to be worthy by the
director exists, including:
o The corporation has a sustained record of timely
payments, and,
o No delinquent tax account with the department.
To request a waiver, submit Arizona Form 292, Electronic
Filing and Payment Waiver Application, to the department.
Arizona Form 292 is available at:
https://azdor.gov/forms/other-forms/electronic-filing-andpayment-waiver-application.
•

•

NOTE: A taxpayer that is required to pay by EFT but who
fails to do so is subject to a penalty of five percent (5%) of
the amount of the payment not made by EFT. See
A.R.S. § 42-1125(O).
For additional information on electronic funds transfer, refer
to A.R.S. § 42-1129 and the related Arizona Administrative
Code rules (A.A.C. R15-10-301 through R15-10-307) for
detailed information.
How to Make EFT Payments
Corporations and PTE’s making an EFT payment from a
checking or savings account or by credit card are no longer
required to register with the department prior to making EFT
payments for tax year 2023. Visit AZTaxes.gov, click “Make
a Corporation/S Corporation/Partnership Payment” and
follow the prompts. An officer of the corporation or a
partner of the partnership must complete the initial EFT
registration.
Taxpayers may use www.AZTaxes.gov to make EFT
payments:
• Electronic payment from checking or savings
account/e-check/ACH Debit.
Payments can be made electronically from a checking or
savings account. Go to www.AZTaxes.gov, click “Make
a Corporation/S Corporation/Partnership Payment”,
follow the prompts, and choose the e-check option.
Follow the prompts to make your payment.
There is no fee to use this method. This payment method
will debit the amount from the specified checking or
savings account on the date specified. When an
electronic payment is made from a checking or
savings account, a confirmation number will be
generated. Please keep this confirmation number as
proof of payment.
• Online credit card payment.
Payments can be made by American Express, Discover,
MasterCard, or Visa credit cards. Go to
www.AZTaxes.gov, click “Make a Corporation/S
Corporation/PartnershipPayment”, follow the prompts,
and choose the credit card option. This will take you to
the website of the credit card payment service provider.
Follow the prompts to make your payment.
The service provider will charge a fee based on the
amount of the tax payment. The service provider will
disclose the amount of the fee during the transaction and
you will be given the option to continue or cancel. If
you accept the fee and complete the credit card

Corporations may also make EFT payment by ACH
Credit. Corporations wishing to pay by ACH credit must
register with the department before their ACH payment will
be accepted.
To register to make ACH Credit payments, complete Arizona
Form number 10366, Electronic Funds Transfer (EFT)
Disclosure Agreement for ACH Credit filers, available here:
https://azdor.gov/forms/other-forms/electronic-funds-transfereft-disclosure-agreement-ach-credit-filers.
Complete the
form as instructed. Submit the completed form at least ten
business days before the first anticipated transaction as it may
take that long to process the application.
Fax the completed form to the department at (602) 771-9913.
You may also email the completed form to the department
at [email protected]. If you have not
received your approval within one week, you may direct
follow-up inquiries to [email protected].
Once the application is processed, you will receive
additional information to present to your bank to make the
ACH Credit payment.
Your payment will be electronically transferred into the
department’s account, normally the next business day.
Consult with your bank for the timeframe required to make
timely payments. You may be charged a service fee.

NOTE: Corporate taxpayers using a foreign bank account
to make EFT payments cannot make EFT payments by
ACH Debit. The department does not accept ACH Debit
payments from a foreign bank account. If the taxpayer
wishes to make payment by EFT, the payment MUST be made
by ACH Credit. See the instructions for ACH Credit above to
register and make ACH Credit payments.

Specific Instructions
All taxpayers who are required to make estimated tax
payments should use Form 120/PTE-W to compute the
required annual payment of estimated tax and the required
installments.
S corporations subject to tax at the federal level and making
the PTE election for the same taxable year must separately
compute their tax liability and required installment payments
for the PTE tax and for the corporate tax. The required
installment payment for each due date is the sum of the
required payment for each due date. (Include all worksheets
with Form 120/PTE-W.)
NOTE: Partnerships and S Corporations making the PassThrough election to pay tax at the entity level, check the box
at the top of the form.

Line 1 - Arizona Tax Liability
Enter the taxpayer's estimated tax liability for the current
(2024) taxable year. Arizona tax liability is computed as
follows: [income tax plus tax from recapture of tax credits]
less [nonrefundable tax credits plus refundable tax credits].
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Arizona Form 120/PTE-W

Line 2a - (All Taxpayers, including partnerships and
S Corporations making the PTE election)

Partnerships and S Corporations making the PTE election,
enter the estimated PTE tax liability for the current (2024)
taxable year.
S corporations subject to tax at the federal level and making
the PTE election for the same taxable year, enter the sum of
the estimated tax liability from the income subject to federal
tax and the estimated tax liability from the PTE income.

Multiply line 1 by ninety percent (90%). Enter the result on
line 2a.

NOTE: Claim of right adjustments (Arizona Forms 120
and 120A): If a taxpayer computes its tax liability under the
claim of right provisions, the estimated tax payments should
be based on the net tax liability computed under the claim of
right provisions.

NOTE: If the taxpayer had no tax liability for 2023, or if its
2023 taxable year was a period of less than twelve months,
skip line 2b and enter the amount from line 2a on line 2d.

Line 2b - C corporations and exempt organizations
with UBTI
Enter the tax as shown on the 2023 return.

Line 2c - S Corporations subject to tax at the federal
level and NOT making the PTE election

Line 2 - Required Annual Payment

Enter the sum of:
• Ninety percent of the portion of the current taxable
Arizona tax liability that is attributable to built-in gains
income or certain capital gains income; plus
• One hundred percent of the portion of the previous taxable
year Arizona tax liability that is attributable to excess net
passive income.

The Arizona required annual payment of estimated tax is the
smaller of A or B:
A. All taxpayers - ninety percent of the taxpayer's Arizona
tax liability (reduced by any refundable tax credits and
the claim of right adjustment, if applicable) for the
current taxable year; or
B. C corporations, and exempt organizations with UBTI one hundred percent of the taxpayer's Arizona tax liability
(reduced by any refundable tax credits and the claim of
right adjustment, if applicable) for the prior taxable year.
S Corporations subject to tax at the federal level not
making the PTE election- an amount equal to the sum of:
(a) ninety percent of the portion of the current taxable
year's Arizona tax liability that is attributable to built-in
gains income or certain capital gains income plus (b) one
hundred percent of the portion of the prior taxable year's
Arizona tax liability that is attributable to excess net
passive income.
S Corporations subject to tax at the federal level AND
making the PTE Election – an amount equal to the sum of:
(a) ninety percent (90%) of the portion of the current
taxable year's Arizona tax liability that is attributable to
built-in gains income or certain capital gains income plus
(b) one hundred percent of the portion of the prior taxable
year's Arizona tax liability that is attributable to excess net
passive income, PLUS (c) one hundred percent (100%) of
the PTE tax shown on the return for the previous taxable
year.
Partnerships and S Corporations making the PTE election
to pay tax at the entity level – one hundred percent (100%)
of the tax shown on the return for the previous taxable
year.

NOTE: If the S corporation’s 2023 taxable year was a period
of less than twelve months, skip line 2c. Enter the amount from
line 2a on line 2d.
S Corporations having a federal tax liability and a PTE tax
liability for the same taxable year. Separately compute the tax
liability for the income generating the corporate tax liability
and for the income generating the PTE tax liability. Enter the
amount of the corporate tax liability on line 2c. Enter the
amount of the PTE tax liability on line 2d.

Line 2d – Partnerships and S Corporations making
the PTE election to pay tax at the entity level

Enter the PTE tax shown on the 2023 return.
S Corporations having a federal tax liability and a PTE tax
liability for the same taxable year. Separately compute the tax
liability for the income generating the corporate tax liability
and for the income generating the PTE tax liability. Enter the
amount of the corporate tax liability on line 2c. Enter the
amount of the PTE tax liability on line 2d.

Line 2e - (All Taxpayers)

C corporations and exempt organizations with UBTI: Enter
the smaller of line 2a or line 2b (if an amount was entered on
line 2b).
S Corporations subject to tax at the federal level and NOT
making the PTE election: Enter the smaller of line 2a or line 2c
(if an amount was entered on line 2c).
Partnerships and S Corporations making the PTE election:
Enter the smaller of line 2a or 2d.
S corporations subject to tax at the federal level AND making
the PTE election for the same taxable year, enter the smaller
of line 2a or the sum of lines 2c and 2d.

NOTE: C corporations and exempt organizations with UBTI
must meet certain conditions in order to make estimated tax
payments equal to one hundred percent of the prior taxable
year's tax liability. (See instructions for line 2b.)
S Corporations subject to tax at the federal level may not use
one hundred percent of the prior taxable year's tax liability. In
addition, S Corporations subject to tax at the federal level must
meet certain conditions in order to make estimated tax
payments equal to the amount calculated in (b) above. (See
instructions for line 2c, below.)

Line 3 - Installment Due Dates
Enter the installment due dates for the estimated payments.
All corporate taxpayers are required to make Arizona corporate
estimated tax payments by the 15th day of the 4th, 6th, 9th, and
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Arizona Form 120/PTE-W
compute their tax liability for the PTE tax and for the corporate
tax. (Include all worksheets with Form 120/PTE-W.)

12th months of their taxable year. If the installment due date
falls on a weekend or legal holiday, the payment is considered
timely if made on the next business day.
Partnerships and S Corporations making the PTE election are
required to make four Arizona estimated payments. The
required installment due dates are the same as for individual
taxpayers: the 15th day of the 4th, 6th, and 9th month of the
taxable year, and the 15th day of the 1st month following the
close of the taxable year.
S corporations subject to tax at the federal level AND making
the PTE election for the same taxable year, enter the
installment due dates for individual taxpayers: the 15th day of
the 4th, 6th, and 9th month of the taxable year and the 15th day of
the 1st month following the close of the taxable year.

Instructions for “Large
Forms 120 and 120A)

(Arizona

“Large corporation” means a corporation or unitary group of
corporations if the corporation, or a predecessor corporation,
had federal taxable income of one million dollars or more for
any of the immediately preceding three taxable years,
excluding any federal net operating loss or capital loss
carrybacks or carryovers. An Arizona affiliated group filing an
Arizona consolidated return is treated as a single corporation
for purposes of applying this definition.
A. If the taxpayer DOES NOT USE the annualized income
installment method or the adjusted seasonal installment
method, follow the instructions below to compute the amounts
to enter on line 4.

Note for short period returns: Enter the installment due
dates and number of installments required by the Internal
Revenue Service.

If line 2a is less than line 2b, enter 25% of line 2a in
columns (a) through (d) of line 4.
• If line 2b is less than line 2a:
o Enter 25% of line 2b in column (a) of line 4.
o Determine the amount to enter in column (b) as
follows:
(i) Subtract line 2b from line 2a,
(ii) Add the result to the amount on line 2a, and
(iii) Multiply the total in (ii) above by 25%.
o Enter 25% of line 2a in columns (c) and (d).
B. If the taxpayer uses the annualized income installment
method and/or the adjusted seasonal installment method,
follow the instructions below to compute the amounts to enter
on Part 3, line 48, columns (a) through (d) before completing
the remainder of the lines in Part 3 of Schedule A.
•

Line 4 - Required Installments
Enter twenty five percent (25%) of line 2e in columns (a)
through (d) unless:
• The entity uses the annualized income installment method;
or,
• The entity uses the seasonal installment method; or,
• The entity is a “large corporation”.
NOTE: When making estimated tax payments, be sure to take
into account any 2023 overpayment that the entity chose to
apply against its 2024 Arizona tax liability.

Annualized Income Installment Method
Adjusted Seasonal Installment Method

Corporations”

and/or

If the taxpayer's income is expected to vary during the taxable
year because, for example, it operates its business on a
seasonal basis, it may be able to lower the amount of one or
more required installments by using the annualized income
installment method or the adjusted seasonal installment
method.
Use Schedule A to calculate the amount of one or more
required installments using one or both of these methods. If
Schedule A is used for any payment due date, it must be used
for all payment due dates.
Use Schedule A to determine the amount of each required
installment and to select the lesser of:
• The annualized income installment;
• The adjusted seasonal installment (if applicable); or
• The regular installment, twenty five percent (25%) of the
required annual payment, increased by any reduction
recapture under Internal Revenue Code § 6655(e)(1)(B).

•

If line 2a is less than line 2b, enter 25% of line 2a in
columns (a) through (d) of Schedule A, Part 3, line 48.

•

If line 2b is less than line 2a:
o Enter 25% of line 2b in column (a) of Schedule A,
Part 3, line 48.
o Determine the amount to enter in column (b) of
Schedule A, Part 3, line 48 as follows:
(i) Subtract line 2b from line 2a,
(ii) Add the result to the amount on line 2a, and
(iii) Multiply the total in (ii) above by 25%.
o Complete the remainder of Part 3, Schedule A.
o Enter 25% of line 2a in columns (c) and (d) of
Schedule A, Part 3, line 48.
Complete the remainder of Schedule A, Part 3.
Enter the amounts from columns (a) through (d) from
Schedule A, Part 3, line 48 in columns (a) through (d) of
this line.

•
•

Partnerships and S Corporations making the PTE election may
utilize the Annualized Income Installment Method to calculate
their required installment if their income is expected to vary
during the taxable year. Partnerships and S Corporations may
NOT use the Adjusted Seasonal Installment Method to
calculate their required installment payments.
S corporations subject to tax at the federal level AND making
the PTE election for the same taxable year must separately

Arizona Form 120/PTE-W Schedule A
Follow the steps below to determine which parts of the Arizona
Form 120/PTE-W, Schedule A, to complete.
• If only the annualized income installment method is used,
complete Parts 1 and 3 of Schedule A.
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Arizona Form 120/PTE-W
•
•
•

If only the adjusted seasonal installment method is used,
complete Parts 2 and 3 of Schedule A.
If both methods are used, complete all three parts of
Schedule A.
All taxpayers: In each column on Arizona Form 120/PTE-W,
line 4, enter the amounts from the corresponding column
of line 48 of Schedule A.

Arizona Form 99T
1st
Installment

2nd
Installment

3rd
Installment

4th
Installment

Standard option

2

3

6

9

Option 1

2

4

7

10

Option

CAUTION: Do not compute any required installment until
after the end of the month preceding the due date for that
installment.

Pass-Through Entities

Part 1 - Annualized Income Installment Method
Partnerships and S Corporations making the PTE election may
utilize the Annualized Income Installment Method to calculate
their required installment if their income is expected to vary
during the taxable year.
Partnerships and S Corporations making the PTE election
may NOT use the Adjusted Seasonal Installment Method to
calculate their required installment payments.

Standard Option

•

•

4th
Installment

Standard option

3

3

6

9

Option 1

2

4

7

10

Option 2

3

5

8

11

5

8

11

Arizona Forms 120, 120A, and 120S
1st
Installment

2nd
Installment

3rd
Installment

4th
Installment

Standard option

4

4

2

1.33333

Option 1

6

3

1.71429

1.2

Option 2

4

2.4

1.5

1.09091

Option

Arizona Form 99T
1st
Installment

2nd
Installment

3rd
Installment

4th
Installment

Standard option

6

4

2

1.33333

Option 1

6

3

1.71429

1.2

Option

Pass-Through Entities

Standard Option

1st
Installment

2nd
Installment

3rd
Installment

4th
Installment

4.0

2.4

1.5

1.0

Line 8 – Annualized Taxable Income Multiply columns (a)

through (d) of line 6 by columns (a) through (d) of line 7. Enter
the result in each column.

Arizona Forms 120, 120A, and 120S
3rd
Installment

3

Enter the annualization amounts for the option used on line 5 in
columns (a) through (d), respectively.

Enter the annualization period the taxpayer is using in
columns (a) through (d), respectively.

2nd
Installment

4th
Installment

Line 7 - Annualization Amounts

Line 5 - Annualization Periods

1st
Installment

3rd
Installment

Enter the taxable income for each annualization period
indicated in columns (a) through (d).

C corporations, exempt organizations with UBTI, and S
Corporations subject to tax at the federal level NOT
making the PTE election, follow the directions here and on
the form.
Partnerships and S Corporations making the PTE
election, compute the required minimum payment using
the PTE tax rate, 2.5%, and the PTE due dates for the
required minimum payment.
S Corporations subject to tax at the federal level and that
are making the PTE election that elect to use the
Annualized Income Installment Method to compute their
required minimum payments must separately compute
their required minimum payments for the income
generating the federal tax liability, and for the income
generating the PTE tax liability. When computing the
required minimum payments for the income generating the
federal tax liability, use the corporate tax rate, 4.9%, and
the due dates for the PTE required minimum payments.
Total the required minimum payments for both sources of
income for each quarter. That amount is the amount of the
S Corporation’s minimum required estimated tax payment.

Option

2nd
Installment

Line 6 – Taxable Income for Annualization Period

NOTE for lines 5 through 20: Complete all lines in each
column before completing the next column.
•

1st
Installment

Line 9 - Calculate the Tax

C Corporations, S Corporations subject to tax at the
federal level, and exempt organizations with UBTI,
multiply columns (a) through (d) of line 8 by the corporate
tax rate, 4.9%. Enter the result in each column.
Partnerships and S Corporations making the PTE election,
multiply columns (a) through (d) of line 8 by the PTE tax rate,
2.5%. Enter the result in each column.
7

Line 18

Arizona Form 120/PTE-W

S corporations subject to tax at the federal level and making the
PTE election must separately compute the annualized taxable
income for the income subject to tax at the federal level and for the
income subject to PTE tax.

Multiply columns (a) through (d) of line 16 by columns (a)
through (d) of line 17. Enter the result in each column.

NOTE: Calculate the tax on the amount in each column using the
instructions for taxable year 2023 for: Arizona Form 99T, line 6;
or Arizona Form 120, line 16; or Arizona Form 120A, line 8; or
Arizona Form 120S, line 19; or Arizona Form 165, line 23.

Do not enter an amount in column (a). Enter the amounts from
Part 3, line 52, columns (a) through (c) in columns (b) through
(d) of this line.

Line 19 - Cumulative Installments

Line 20 – Annualized Income Installments

Line 10 - Tax From Recapture of Tax Credits

Enter line 18, column (a) in line 20, column (a). Subtract line 19
columns (b) through (d) from line 18 columns (b) through (d).
Enter the difference. If zero or less, enter “0”.

Enter the amount of tax due from recapture of the following
credits for each payment period in each column (a) through (d):
• The Credit for Motion Picture Production Costs claimed on
Arizona Form 334,
• The credit for Qualified Facilities claimed on Arizona
Form 349,
• The credit for Renewable Energy Investment and
Production for Self-Consumption by International
Operations Centers claimed on Arizona Form 351, and,
• The Affordable Housing Tax Credit claimed on Form 354.

Part 2 - Adjusted Seasonal Installment Method
NOTE: This method of computing required minimum
payments is not available to partnerships and S Corporations
making the PTE election.
Complete Part 2 only if the taxpayer’s base period percentage
for any 6 consecutive months of the tax year equals or exceeds
seventy percent (70%). Figure the base period percentage
using the 6 month period in which the taxpayer normally
receives the largest part of its taxable income.
The taxpayer’s base period percentage for any period of 6
consecutive months is the average of the three percentages
figured by dividing the taxable income for the corresponding 6
consecutive month period in each of the 3 preceding tax years
by the taxable income for each of their respective tax years.
See the EXAMPLE below for information on how to
calculate the base period percentage.

Line 11 – Subtotal Tax
Add columns (a) through (d) of lines 9 and 10. Enter the total
in each column.

Line 12 - Nonrefundable Tax Credits

Enter the total amount of nonrefundable tax credits to which
the taxpayer is entitled because of events that occurred during
the months shown in the column headings used to calculate
annualized taxable income. Calculate this amount using the
instructions for taxable year 2023 for: Arizona Form 99T,
line 9; or Arizona Form 120, line 19; or Arizona Form 120A,
line 11; or Ar