2026 tax year · Arizona
Rental host taxes in Arizona
Airbnb, Turo and the rest report your gross and withhold nothing. The gap between that and what you are taxed on is your costs, in Arizona that gap is worth $2,487 in tax.
Take a driver who grossed $39,000 over 18,000 business miles. After mileage at 74.3 cents and the rest of the stack, worked through on the rental host page $10,100 comes off and $28,900 is left as taxable profit. That profit is what Arizona and the IRS charge against.
What that leaves you owing in Arizona
Arizona taxes income at a flat 2.5% for 2026, applied on top of federal income tax and self-employment tax.
| Self-employment tax | $4,083 |
| Federal income tax | $861 |
| Arizona income tax | $671 |
| Total tax | $5,616 |
| Effective rate on gross | 14.4% |
Earning more in Arizona
A single filer taking the standard deduction, this work as the only income, the calculator above handles the other filing statuses. Miles rise with earnings, so the deduction rises too, and the effective rate on gross climbs more slowly than it would for someone whose income grew without expenses attached:
| Volume | Gross | Mileage off | Taxable profit | Arizona tax | Total tax | Rate on gross |
|---|---|---|---|---|---|---|
| Part-time | $13,000 | $0 | $13,000 | $302 | $2,139 | 16.5% |
| Steady side income | $39,000 | $0 | $39,000 | $906 | $8,103 | 20.8% |
| Full-time | $63,000 | $0 | $63,000 | $1,464 | $14,192 | 22.5% |
Arizona specifics that change the number
Arizona is a community property state. In community property states, income earned during marriage is generally owned equally by both spouses. This affects QJV eligibility, MFS filing strategies, and retirement account contribution rules.
Local taxes on an Arizona let
The income tax below is only part of it. Short-term lets attract occupancy, lodging or transient taxes levied by the city or county rather than Arizona, often at rates that dwarf the state income tax. Some platforms collect and remit them; some collect only part; in some places the host is on the hook entirely. That is a local question this calculator cannot answer, and it is the one hosts most often get wrong.
On $28,900 of profit, what the states around Arizona would charge:
| State | Its tax | vs Arizona |
|---|---|---|
| Nevada | No income tax | −$723 |
| California | $370 | −$353 |
| New Mexico | $1,126 | +$403 |
| Utah | $1,301 | +$578 |
- Nevada has no income tax at all, so the same work done there costs $723 less in state tax than it does in Arizona.
- California would take $353 less, $370 against Arizona's $723.
- New Mexico would take $403 more, $1,126 against Arizona's $723.
- Utah would take $578 more, $1,301 against Arizona's $723.
Rental host tax questions in Arizona
How much should an Arizona host set aside?
About 14.4% of gross on the $39,000 example, $5,616 across self-employment tax, federal income tax and $671 to Arizona. In practice that means moving about $144 of every $1,000 payout into a separate account the day it lands, and sending roughly $1,404 to the IRS each quarter, no platform withholds any of this for you. Set aside from each payout rather than finding it in April.
Does the $39,000 on my 1099-NEC match what Arizona taxes?
No. Arizona taxes profit, not gross. After $10,100 of deductions the taxable figure is $28,900, so the Arizona bill is $671 rather than what gross alone would suggest. The form reports what the platform paid out, it knows nothing about your costs, and no one subtracts them for you. On this example 26% of the gross never becomes taxable income, but only for the host who kept the records to prove it.