Bill
HB 2601
Arizona HB 2601: Exempts individuals under 18 with Arizona gross income up to $50,000 from state income tax starting in 2026.
Summary — Note on document consolidation
The materials provided appear to contain text from two different bills that share the number HB 2601 but originate in different states and address different taxes. Below are separate, concise summaries of each measure so readers can clearly see purpose, key provisions, affected parties, and timing.
1) Arizona — HB 2601 (Income tax; exemption for minors)
- Purpose / intent
- Create a state income tax exemption for minors and add a related withholding exclusion for employers.
- Key provisions
- Amends A.R.S. § 43-403 (withholding exclusions) to add: the first $50,000 of wages paid to an employee under 18 is excluded from withholding.
- Adds A.R.S. § 43-1043 establishing a tax exemption: any individual under 18 whose Arizona gross income is $50,000 or less for the taxable year is exempt from Arizona individual income tax for that year, regardless of income source.
- Requires the Arizona Department of Revenue to set up a process to verify eligibility for the exemption.
- Changes article heading from “DEDUCTIONS” to “DEDUCTIONS AND EXEMPTIONS.”
- Who is affected
- Primary beneficiaries: individuals under 18 with Arizona gross income ≤ $50,000.
- Employers: must adjust payroll withholding procedures to exclude the first $50,000 for qualifying employees (and implement any employer-side changes).
- Arizona Department of Revenue: must create verification procedures and administer the exemption.
- State budget: likely reduces individual income tax receipts from minors (magnitude not specified in the text).
- Timing / procedural status
- Introduced in Arizona House on February 10, 2025.
- Applicability: taxable years beginning after December 31, 2025.
- Legislative status noted as Rule 19(a) / re‑referred to Rules Committee (March 21, 2025); various committee actions listed in the file.
2) Illinois — HB 2601 (Estate tax; exclusion amount)
- Purpose / intent
- Increase the Illinois estate (and generation‑skipping transfer) tax exclusion to reduce the number of taxable estates and align the state exclusion level with higher exemption amounts.
- Key provisions
- Amends the Illinois Estate and Generation‑Skipping Transfer Tax Act (35 ILCS 405/2) to set the applicable exclusion at $8,000,000 for persons dying on or after January 1, 2026. (Previous exclusion referenced in the text is $4,000,000 for deaths on/after Jan 1, 2013 and prior to Jan 1, 2026.)
- Other statutory definitions and cross‑references to federal law remain in place; the change primarily raises the exclusion threshold used in computing state estate and related credits.
- Who is affected
- Estates of decedents: fewer estates will owe Illinois estate tax for deaths on or after Jan 1, 2026, because the exclusion doubles from $4M to $8M.
- Heirs and beneficiaries: smaller estates avoid tax, larger estates may pay less tax.
- State finances: likely reduces estate tax receipts; the bill does not include a fiscal note in the text provided.
- Timing / procedural status
- Introduced in Illinois General Assembly (text shows introduction Feb 6, 2025 by Rep. Adam M. Niemerg).
- Effective date language in the Illinois text: the Act “takes effect upon becoming law,” but the raised exclusion applies to persons dying on or after January 1, 2026 (per the statute language).
Sponsors (as provided in the combined document)
- Arizona-style sponsors listed: Nick Kupper (primary), with cosponsors Alexander Kolodin, Rachel Keshel, Ralph Heap, David Gowan, Michael Way, David Livingston, James Taylor, David Marshall Sr., Chris Lopez, Jeff Weninger.
- Illinois sponsor listed: Rep. Adam M. Niemerg (primary in Illinois text).
Bottom line
- The Arizona HB 2601 would exempt minors with up to $50,000 in Arizona gross income from state income tax and require withholding changes (effective for tax years beginning after 12/31/2025).
- The Illinois HB 2601 would raise the Illinois estate tax exclusion to $8,000,000 for deaths on or after 1/1/2026, reducing the number/size of taxable estates (effective upon enactment with the specified applicability date).
Compiled from official sources — confirm details with the bill’s official record.
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