HomeMy WebLinkAboutRes 2019-33 RESOLUTION 2019-33
A RESOLUTION OF THE MAYOR AND COUNCIL OF THE TOWN OF
FOUNTAIN HILLS, ARIZONA, ADOPTING AN INTERGOVERNMENTAL
AGREEMENT WITH THE ARIZONA DEPARTMENT OF REVENUE
RELATING TO THE ADMINISTRATION OF TRANSACTION PRIVILEGE
TAX
ENACTMENTS:
BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF FOUNTAIN HILLS, as
follows:
SECTION 1. The Intergovernmental Agreement with the Arizona Department of Revenue
related to a uniform method of administration, collection, audit and licensing of transaction
privilege and affiliated excise taxes (the "Agreement")is hereby approved substantially in
the form and substance attached hereto as Exhibit A and incorporated herein by
reference.
SECTION 2. The Mayor, the Town Manager, the Town Clerk, and the Town Attorney are
hereby authorized and directed to take all steps necessary to carry out the purpose and
intent of this Resolution.
PASSED AND ADOPTED by the Mayor and Council of the Town of Fountain Hills,
Arizona, June 4, 2019.
FOR THE TOWN OF FOUNTAIN HILLS: ATTESTED TO:
1
Ginny� icke;, ayor zabeth urke, Town Cle c
REVIEWED BY: APPROVED AS TO FORM:
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Grady E. Mil , own Manager Aaron DTArnson, Town Attorney
EXHIBIT A
TO
RESOLUTION 2019-33
[Agreement]
See following pages.
CAS:dkk 1350750.1 10/14/2010
INTERGOVERNMENTAL AGREEMENT BETWEEN
THE STATE OF ARIZONA AND
THE TOWN OF FOUNTAIN HILLS
THIS INTERGOVERNMENTAL AGREEMENT ("Agreement") is entered into this
day of , 2019, by and between the Arizona Department of Revenue,
hereinafter referred to as Department, and the Town of Fountain Hills, an Arizona municipal
corporation, hereinafter referred to as City/Town. This Agreement shall supersede and replace all
previous intergovernmental agreements, including amendments thereto, entered into by the
Department and City/Town regarding the administration, collection, audit and/or licensing of
transaction privilege tax,use tax, severance tax,jet fuel excise and use taxes and rental occupancy
taxes imposed by the State, cities or towns.
RECITALS
WHEREAS,Title 11, Chapter 7,Article 3 (A.R.S. § 11-952)authorizes two or more public
agencies to enter into intergovernmental agreements to contract for services, if authorized by their
legislative or governing bodies.
WHEREAS, A.R.S. § 42-6001 et seq. was amended effective January 1, 2015 to provide
that the Department shall collect and administer any transaction privilege and affiliated excise
taxes imposed by any city or town in Arizona and that the Department and each city or town shall
enter into an intergovernmental contract or agreement pursuant to A.R.S. § 11-952 to provide a
uniform method of administration, collection, audit and licensing of transaction privilege and
affiliated excise taxes imposed by the State, cities or towns.
WHEREAS,City/Town has taken appropriate action by ordinance,resolution or otherwise,
pursuant to the laws applicable to the governing body of City/Town, to approve and authorize
City/Town to enter into this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, the Department and City/Town
enter into this intergovernmental agreement as follows:
1. Definitions
1.1 A.R.S. means the Arizona Revised Statutes.
1.2 Adoption of an Ordinance means final approval by majority vote of the
City/Town council.
1.3 Ambassador Program means the Department's provided structure and support of
curriculum related to tax administration and compliance education.
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1.4 Audit means examination and verification of accounts and records to determine
taxpayer compliance with title 42 of A.R.S. and the Model City Tax Code, or any
other assessment issued pursuant to A.R.S. § 42-1108.
1.5 Closing Agreement means an agreement to settle a tax liability pursuant to A.R.S.
§ 42-1113.
1.6 Confidential Information means all such information as defined in A.R.S. § 42-
2001.
1.7 Confidentiality Standards means the standards set forth in Appendix A or such
other written standards mutually agreed to by the Department and City/Town.
1.8 Desk Review means any assessment issued pursuant to A.R.S. § 42-1109(B).
1.9 Federal Tax Information means federal tax return or return information the
I Department receives from the Internal Revenue Service including any information
created by the Department derived from that information. Documents obtained
from a taxpayer or State records are not considered Federal Tax Information.
1.10 Model City Tax Code means the document defined in A.R.S. § 42-6051.
1.11 Modification means a change to an assessment required or authorized by statute.
i
1.12 Municipal Tax(es) means transaction privilege and affiliated excise taxes,
including use tax, severance tax,jet fuel excise and use tax, and rental occupancy
tax, imposed by City/Town in accordance with the Model City Tax Code. Unless
the context provides otherwise, this definition includes tax, license fees, penalties,
interest and other similar charges.
1.13 State means the State of Arizona.
1.14 State & Municipal Audit Resolution Team ("SMART") means an advisory
group comprised of four representatives from municipal taxing jurisdictions and
four representatives of the Department as set forth in Section 14 below.
1.15 Taxpayer Information means information protected from disclosure pursuant to
Model City Tax Code § 510.
1.16 Standard Audit Life Cycle Process Map: A document containing the decisions
and procedures adopted by the Department and Cities/Towns from the point of audit
assignments until resolution consistent with this Agreement and the Arizona
Management System principle of continuous improvement. This document will be
reviewed by the Department and cities/towns as needed,not less than annually,with
any changes memorialized in a revised map. In the event of unresolved
disagreement regarding proposed changes,this Map will be referred to SMART for
resolution.
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1.17 Standard Authorization List Update Process Map: A process containing the
decisions and procedures adopted by the Department and Cities/Towns to keep an
updated list of current employees and contractors who are authorized to receive
confidential information consistent this Agreement and with the Arizona
Management System principle of continuous improvement. This document will be
reviewed by the Department and cities/towns as needed,not less than annually,with
any changes memorialized in a revised map. In the event of unresolved
disagreement regarding proposed changes,this Map will be referred to SMART for
resolution.
1.18 Standard Inter-Jurisdictional Transfer Process Map: A process containing the
decisions and procedures adopted by the Department and Cities/Towns to transfer
tax from one City/Town to another City/Town upon a City/Town's request or during
the audit process consistent this Agreement and with the Arizona Management
System principle of continuous improvement. This document will be reviewed by
the Department and cities/towns as needed,not less than annually,with any changes
memorialized in a revised map. In the event of unresolved disagreement regarding
proposed changes, this Map will be referred to SMART for resolution.
1.19 Voluntary Disclosure Agreement: A program that is designed for eligible
taxpayers with exposure for tax liability and /or civil penalties due to a failure to
report and/or pay all tax due.
2. Disclosure of Information by City/Town to Department
2.1 Qualified Recipients of Information: The Department shall provide a list of
names and job titles of duly authorized representatives acting on behalf of the
Department authorized to request and receive Taxpayer Information from
Cities/Towns as defined in the Standard Authorization List Update Process Map.
This information shall be sent to Cities/Towns as defined in the Standard
Authorization List Update Process Map. The Cities/Towns will not disclose
Taxpayer Information to a Department employee whose name is not included on
this list. Cities/Towns may contact the Department with any questions related to
qualified recipients by contacting the Cities Services Unit.
2.2 Use of Information: Any Taxpayer Information released by City/Town to the
Department may only be used by the Department for tax administration and
collection purposes, and may not be disclosed to the public in any manner that does
not comply with the Model City Tax Code.All Taxpayer Information shall be stored
and destroyed in accordance with the Confidentiality Standards.
2.3 Municipal Ordinance:
(a) City/Town shall provide the Department with a copy of its Municipal Tax
Code or any City/Town ordinances imposing the taxes to be collected
hereunder within ten calendar days of a request for such information from the
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Department. This information shall be sent to the Cities Services Unit
electronically.
(b) City/Town shall provide the Department with a copy of any ordinance
adopted by City/Town after execution of this Agreement that imposes or
modifies the Municipal Taxes or license fees to be collected hereunder,
including a new or different tax rate as defined by A.R.S. §42-6053(E),within
ten calendar days of adoption of an ordinance. This information shall be sent
to the Cities Services Unit electronically. No such ordinance shall take effect
on a date other than the first day of the month that is at least sixty calendar
days after city/town provides notice to the Department unless City/Town and
the Department agree otherwise. The Department shall add the change to the
official copy of the Model City Tax Code within ten business days of receipt
of notice from City/Town. The Department will notify City/Town when the
change has been made, and City/Town is responsible for confirming the
change. Pursuant to A.R.S. § 42-6053(E)(2), changes in tax rates have no
effect unless reflected in the official copy of the Model City Tax Code.
(c) Within fifteen calendar days following the adoption of an annexation
ordinance, one copy of the ordinance and notification of the effective date of
such ordinance shall be sent to the Department via email at GIS@azdor.gov.
City/Town shall also include with the notice a list of businesses City/Town
knows to be located in the annexed area. The Department shall not be
obligated to begin collection of Municipal Tax any sooner than the first day
of the month that is at least sixty calendar days after the date the Department
received notice from City/Town of the annexation.
2.4 Development and Impact Fees: Upon request, City/Town shall provide to the
Department any information regarding development and impact fees to assist the
Department with the auditing of taxpayers and billing and collection of taxes.
2.5 Prior Audits: Upon request by the Department, City/Town shall allow inspections
and copies of any City/Town tax audits conducted prior to January 1, 2015.
2.6 Other Information: City/Town shall provide other relevant information necessary
for tax administration and collection purposes as requested by the Department.
2.7 Statutory Authority: The disclosure of confidential City/Town tax information is
governed by A.R.S. § 42-2001 et seq., or Model City Tax Code Section 510 for all
reporting periods prior to January 1, 2015.
3. Disclosure of Information by Department to City/Town
3.1 Qualified Recipients of Information: City/Town shall provide a list of the names
and job titles of duly authorized representatives acting on behalf of City/Town
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authorized to receive Confidential Information as defined in the Standard
Authorization List Update Process Map. The Department will not disclose any
Confidential Information to any representative whose name is not included on this
list. The Department may contact City/Town with any questions related to
authorized recipients.
3.2 Suspension of Information: The Department will not withhold Confidential
Information from City/Town so long as City/Town complies with A.R.S. §42-2001
et seq. and the Confidentiality Standards.
(a) If the Department has information to suggest City/Town or any of its duly
authorized representatives violated A.R.S. § 42-2001 et seq. or the
Confidentiality Standards (Appendix A), the Department will send written
notice to City/Town detailing the alleged breach as understood by the
Department and requesting a response to the allegation within twenty
calendar days of the date of the letter.
(b) The Department will review the written response from City/Town and
consider the information contained therein and all relevant circumstances
surrounding the alleged violation before making a written determination as to
whether a suspension of information is warranted and the length of the
suspension.
(c) If City/Town is dissatisfied with the Department's determination, it may
within ten calendar days, submit a written request to SMART requesting the
group review the determination pursuant to Section 14.
(d) If the Department has information to suggest City/Town violated the
Confidentiality Standards, the Department may inspect City/Town's records,
facilities, and equipment to confirm whether there has been a violation upon
notification to City/Town.
3.3 Information to be Provided: Within the restrictions outlined in this Section, the
Department shall provide all of the information detailed in Appendix B,which may
be modified by the mutual agreement of the parties. The Department shall not
provide Federal Tax Information to City/Town. In addition to the information
detailed in Appendix B, City/Town may obtain upon request:
(a) Inspections and/or copies of Department tax audits, including all information
related to all cities and towns included in the tax audit; and
(b) Other relevant information necessary for tax administration and collection
purposes, including all information necessary to verify City/Town received
all revenues collected by the Department on behalf of City/Town.
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3.4 Storage and Destruction of Confidential Information: All Confidential
Information provided by the Department to City/Town shall be stored, protected,
and destroyed in accordance with the Confidentiality Standards.
3.5 Statutory Authority: The Department may disclose Confidential Information to
City/Town pursuant to A.R.S. § 42-2003(G) if the information relates to a taxpayer
who is or may be taxable by a county, city or town. Any Confidential Information
released to City/Town:
(a) May only be used for internal tax administration purposes as defined in A.R.S.
§ 42-2001(4); and
(b) May not be disclosed to the public in any manner that does not comply with
the Confidentiality Standards.
A.R.S. § 42-2003(G) provides that any release of Confidential Information that
violates the Confidentiality Standards will result in the immediate suspension of
any rights of City/Town to receive taxpayer information pursuant to Section 3.2 of
this agreement. Under no circumstances shall the suspension of any right to receive
taxpayer information adversely impact the delivery or transfer of any City/Town
revenues in any manner.
3.6 Specificity of Data: Pursuant to A.R.S. § 42-6001,the Department and City/Town
agree that the data fields identified in Appendix B and the JT-1, TPT-2 and TPT-
EZ forms provided in Appendix C meet the specificity requirements of City/Town.
The forms provided in Appendix C may be revised and replaced as needed by
mutual agreement of the Department and City/Town based on approval by
SMART.
4. Audit
The Department shall administer the audit functions with City/Town in accordance with
the Standard Audit Life Cycle Process Map and with the following provisions.
4.1 Training: All auditors and supervisors shall be trained in accordance with the
policies of the Department. Auditors who have not completed the training may only
work in connection with a trained auditor and cannot be the only auditor assigned
to the audit. The Department shall:
(a) Provide semi-annual audit training in accordance with A.R.S. § 42-6002(C)
and be responsible for the costs of the training, limited to the site and training
materials;
(b) Notify City/Town of any training sessions at least thirty calendar days before
the date of the training session;
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(c) Permit City/Town auditors and supervisors to attend any scheduled training
as space permits at any designated training location; and
(d) Provide additional training, as needed, to inform auditors and supervisors
regarding changes in State law, the Model City Tax Code, Audit Procedures
or Department policy.
4.2 Conflict of Interest: An auditor or supervisor trained and authorized to conduct an
audit may not conduct any of the following prohibited acts:
(a) Represent a taxpayer in any tax matter against the Department or City/Town
while employed or in an independent contractor relationship with the
Department or City/Town.
(b) Attempt to use his/her official position to secure any valuable thing or
valuable benefit for himself/herself or his/her family members.
(c) Represent a taxpayer before the Department or City/Town concerning any
matter in which he/she personally participated for a period of one year after
he/she ends employment or the independent contractor relationship with the
Department or City/Town.
(d) Use information he/she acquires in the course of the official duties as an
auditor or supervisor in a manner inconsistent with his/her official duties
without prior written approval from the Department.
(e) For a period of one year after he/she ends employment or an independent
contractor relationship with the Department or City/Town, work in the same
firm as a person who represents a taxpayer against the Department or
City/Town unless the firm institutes formal barriers to prevent any sharing of
information between the trained auditor or supervisor and the remainder of
the firm.
The Department may revoke an individual's authority to audit and prohibit the use
of any auditor or supervisor who violates this provision.
4.3 Audits and Refunds:
(a) City/Town may request the Department conduct an audit or review of any
taxpayer engaged in business in City/Town, including a taxpayer whose
business activity is subject to tax by the City/Town but is not subject to tax
by the State. The Department and the cities and towns shall collaboratively
establish and maintain minimum justification standards and procedures
City/Town shall adhere to when submitting an audit request.
(b) City/Town may conduct an audit of a taxpayer engaged in business only in
City/Town. Before commencing such audit, City/Town shall submit a Field
Audit Request Form. The Department will provide City/Town with a
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determination to proceed or not within ten calendar days of the notice from
City/Town.
(c) Except as permitted below, the Department shall conduct all audits of
taxpayers having locations in two or more cities or towns. A City/Town
auditor may participate in any audit City/Town requested the Department to
perform.
(d) City/Town shall notify the Department if it wants to audit a taxpayer having
locations in two or more Arizona cities or towns and whose business activity
is subject to tax by the City/Town but is not subject to tax by the State. The
Department will authorize such audits, to be overseen by the Department,
unless there is already an audit of the taxpayer scheduled, or the Department
determines the audit selection is discriminatory, an abuse of process or poses
other similar defects. The Department will notify City/Town of its
determination within fifteen (15) calendar days. No initial audit contact may
occur between City/Town and a taxpayer until the Department approves the
audit notice.
(e) In the case of taxpayers doing business in more than one city/town:
(1) City/Town may either request the Department conduct an audit of a
taxpayer having locations in two or more Arizona cities or towns and
whose primary business is subject to both city and state tax, or
(2) City/Town may request to conduct an audit of a taxpayer having
locations in two or more Arizona cities or towns and whose primary
business is subject to both cities' and state tax.
(3) Requests pursuant to (e)(1) or (e)(2) shall be made using the
Department's Field Audit Request Form. The Department shall notify
City/Town of its decision regarding the request within fifteen (15)
calendar days of receipt of the request.
(f) The Department may deny a request for an audit in writing within 15 days of
city/town request for the following reasons:
(1) An audit is already scheduled or planned for the taxpayer within six
months of the request;
(2) The requested audit would interfere with strategic tax administration
planning;
(3) The audit selection is discriminatory, an abuse of process or poses other
similar defects;
(4) The request lacks sufficient information for the Department to
determine whether it is appropriate;
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(5) The Taxpayer was audited within the previous two years;
(6) The Department lacks sufficient resources to conduct the audit; or
(7) The scope or subject of the audit does not justify the use of Department
resources.
(g) If the Department denies a request to conduct an audit because it either lacks
resources to conduct the audit itself or the scope or subject of the audit does
not justify the use of Department resources then City/Town shall notify the
Department if it wants to conduct the audit under the supervision of the
Department. No initial audit contact may occur between City/Town and a
taxpayer until the Department's supervisor is appointed to the audit.
(h) Any decision by the Department denying City/Town's request to conduct any
audit may be referred to SMART in accordance with Section 14 of this
Agreement.
(i) All audits conducted by City/Town shall be in accordance with standard audit
procedures defined in the Department audit manual and the Standard Audit
Life Cycle Process Map. All auditors shall be trained in accordance with
Section 4.1 above.
(j) The Department may appoint a Department manager to supervise any audit
conducted by City/Town.
(k) All audits shall include all taxing jurisdictions in the State regardless of which
jurisdiction's auditors participate in the audit. All desk reviews must include
all taxing jurisdictions for which there is information provided by the
taxpayer.
(1) The Department shall issue all audit assessments on behalf of all taxing
jurisdictions in a single notice to the taxpayer.
(m) The Department shall issue amendments to audit assessments on behalf of all
taxing jurisdictions in a single notice to the taxpayer.
4.4 Claims for Refund:
(a) When a taxpayer files a request for refund, including refunds requested by
filing amended returns, the Department shall process the request and review
it for mathematical errors or for the failure of the taxpayer to properly
compute the tax based on the taxable income reported on the return or refund
request.
(b) The Department will notify City/Town of all refund requests that are
processed involving City/Town's Municipal Taxes within thirty calendar
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days of processing the refund. City/Town may request an audit of the taxpayer
as set forth in Section 4.3 above.
(c) The Department may assign an auditor to review requests for refunds. The
Department will notify City/Town, within thirty calendar days of initiating a
review,of all refunds under review by an auditor pertaining to a taxpayer who
engages in business within City/Town's taxing jurisdiction and may request
that City/Town assist with such reviews.The Department may assign a refund
request to a City/Town auditor for review. The Department may only assign
refund requests to a City/Town auditor if the City/Town is involved in the
refund request.
(d) City/Town is responsible for payment of all amounts to be refunded to
taxpayers for Municipal Tax incorrectly paid to City/Town. The Department
may offset a remittance to City/Town under this Agreement to cover the
amounts of allowed refunds paid to the Department. If there are insufficient
funds available to pay the refund, City/Town must pay the Department within
sixty days of written demand from the Department.
(e) The Department shall issue refund approvals/denials on behalf of all taxing
jurisdictions in a single notice to the taxpayer. City/Town may request copies
of such determinations.
4.5 Protests: Taxpayer protests of audit assessments and desk review assessments and
refund denials shall be directed to the Department. Appeals of audit assessments,
desk review assessments and refund denials shall be administered pursuant to
A.R.S. Title 42, Chapter 1, Article 6. The Department shall notify City/Town of
any appeals within 30 days of receipt of the protest.
4.6 Status Reports: The Department shall keep SMART apprised of the status of each
protested matter involving the imposition of Municipal Taxes. City/Town may
request to be on a distribution list for monthly status reports by contacting the
Department.
5. Voluntary Disclosure Agreements
The Department may enter into a voluntary disclosure agreement with a taxpayer. A
voluntary disclosure agreement may limit the years subject to audit and waive penalties.
The Department will notify City/Town of the Department's intent to enter into an
agreement and the Department will provide the taxpayer's identity within thirty (30)
calendar days of disclosure. City/Town may request an audit of a taxpayer subject to a
voluntary disclosure agreement pursuant to Section 4.3 above.
6. License Compliance
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6.1 License Issuance and Renewal: The Department shall issue new Municipal Tax
licenses and renew such licenses for City/Town Municipal Tax. The Department of
Revenue shall provide City/Town with information about all persons obtaining and
renewing tax licenses as set forth in Appendix B.
6.2 License Checks: The Department and City/Town shall coordinate efforts to
conduct tax license compliance checks through canvassing and other compliance
methods.
6.3 Confidentiality: Any tax license information City/Town obtains from the
Department is considered Confidential Information and may only be disclosed as
authorized by A.R.S. § 42-2003. Any tax license information City/Town obtains
through its own efforts may be disclosed as allowed by applicable City/Town laws.
6.4 Changes to License Fees: Within ten(10)business days following the adoption of
an ordinance (or official acknowledgment of approval of an ordinance by voters in
an election of a charter city) issuing or modifying a tax license fee, one copy of the
ordinance and notification of the effective date of such ordinance shall be sent to
the Department's City Services Unit. The Department shall not be obligated to
begin collection of the new or modified fee any sooner than sixty calendar days
after the date the Department received the ordinance from City/Town.
7. Closing Agreements
The Department shall notify City/Town before entering into a Closing Agreement and shall
seek a range of settlement authority from City/Town related to the tax levied and imposed
by City/Town in accordance with the Standard Audit Life Cycle Process.
8. Responsibility for Representation in Litigation
8.1 Administrative Proceedings: The Department shall be responsible for
coordinating the litigation and defending the assessment or refund denial in any
administrative appeals before the Office of Administrative Hearings or the Director
of the Department regardless of the jurisdiction that conducted the audit in
accordance with the Standard Audit Life Cycle Process Map.The Department shall
be diligent in defending the interests of City/Town and City/Town shall assist in
such representation as may be requested by the Department or by City/Town.
8.2 Further Appeals: The Arizona Attorney General is responsible for defending the
assessment or refund denial at the Board of Tax Appeals, the Arizona Tax Court
and all higher courts. City/Town shall assist the Attorney General in such
representation and litigation as requested by the Attorney General's Office in
accordance with the Standard Audit Life Cycle Process Map.
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8.3 Mutual Cooperation: The Department and City/Town agree they shall cooperate
in the appeal and litigation processes and shall ensure their auditors, supervisors,
and other necessary employees are available to assist the Department and the
Attorney General for informal interviews, providing documents and computer
records,preparing for depositions, attending depositions and trial as witnesses, and
assisting in trial/hearing preparation, as needed.
8.4 Administrative Decisions: The Department shall provide a copy of any and all
administrative hearing level decisions,including Director's decisions issued by the
Department to all jurisdictions on a distribution list. City/Town may request to be
on the distribution list by contacting the Department's Cities Unit. Administrative
decisions are Confidential Information and must be stored and destroyed in
accordance with the Confidentiality Standards.
9. Collection of Municipal Taxes
9.1 Tax Returns: Taxpayers who are subject to City/Town Municipal Taxes shall pay
such taxes to the Department. Tax payments shall be accompanied by a return
prepared by taxpayer on a form prescribed by the Department.
9.2 Collections: The Department shall collect any Municipal Tax imposed by
City/Town recorded on the Department's tax accounting system. Amounts the
Department collects for delinquent City/Town Municipal Tax accounts after the
termination of this Agreement shall be forwarded to City/Town. The Department
and City/Town may enter into an additional agreement to provide joint collection
efforts on the following terms:
(a) Training: All City/Town collectors authorized to collect obligations in
cooperation with the Department shall be trained in accordance with the
policies of the Department. Training shall be provided in the same manner
as set forth in Section 4.1 of this Agreement.
(b) Conflict of Interest: A collector authorized under this provision may not:
(1) Represent a taxpayer in any tax matter against the Department or
City/Town while employed by the City/Town.
(2) Attempt to use his/her official position to secure any valuable thing or
valuable benefit for himself/herself or his/her family members.
(3) Represent a taxpayer before the Department or City/Town concerning
any matter in which he/she personally participated for a period of one
year after he/she ends employment with the City/Town.
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(4) Use information he/she acquires in the course of the official duties as
a collector in a manner inconsistent with his/her official duties without
prior written approval from the Department.
(5) For a period of one year after he/she ends employment with the
City/Town, work in the same firm as a person who represents a
taxpayer against the Department or City/Town unless the firm
institutes formal barriers to prevent any sharing of information
between the trained collector and the remainder of the firm.
(c) Revocation: The Department may revoke an individual's or City/Town's
authority to collect obligations under this section, subject to review by
SMART upon request by the individual or City/Town.
9.3 State of Arizona Liquor License Affidavit: City/Town may request that the
Department issue a liquor license affidavit. The Department will respond to the
request via secured e-mail with a note stating complete, in-process, or unable to
complete. When the City/Town request liquor license affidavits, they will need to
elect the prescribed method if they are willing to pay for the Arizona Department
of Liquor Licenses and Control (ADOLLC) hearing if the license is held for
renewal until balance paid in full. The Department and City/Town will negotiate
how the cost of the hearing will be shared between the Department and City/Town
on a case by case basis.
9.4 Uncollectible/Discretionary Write-offs: The Department will share the annual list
of uncollectible/discretionary write-offs prior to the end of fiscal year write-off
event. City/Town will have 45 days to submit feedback.
9.5 Remittance: All amounts collected by the Department for Municipal taxes,
penalties and interest under this Agreement shall be remitted to City/Town weekly
on the basis of actual collections. To the extent possible, the Department shall
initiate the electronic payment by noon on the Monday after the end of the week in
which the collections were made. Remittance shall be made in the form of
immediately available funds transferred electronically to the bank account
designated by City/Town.
9.6 Abatement:The Department,with the approval of the Attorney General,may abate
tax under certain circumstances. During the ordinary course of business, the
Department may determine for various reasons that certain accounts shall be closed
or cancelled. The Department shall seek input from City/Town or SMART before
abating tax or closing accounts. The Department may request a telephonic meeting
of SMART if time or circumstances require immediate action.
9.7 Funds Owed to City/Town: At all times and under all circumstances payments
remitted by a taxpayer to the Department for City/Town Municipal Taxes will be
considered property of City/Town. The Department may not retain or fail to remit
such funds to City/Town for any reason not specifically set forth in this Agreement
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including,but not limited to, during the course of a dispute between City/Town and
the Department.
9.8 Adjustments to Reported Taxes: If the Department determines that a payment
remitted by a taxpayer incorrectly identifies the city or town to which the payment
should be made, Department may temporarily hold the payment until the
distribution of the payment is corrected to ensure the appropriate city or town
receives the payment.If a payment by the Department has been made to an incorrect
City/Town, the Department and affected cities or towns shall follow the Standard
Inter-Jurisdictional Transfer Process Map.
10. Taxpayer Rulings and Uniformity
The Department shall be responsible for issuing taxpayer ruling requests and
interpretations of the Model City Tax Code. City/Town acknowledges that pursuant to
A.R.S. 42-6005(B), when the state statutes and Model City Tax Code are the same and
where the Department has issued written guidance, the Department's interpretation is
binding on cities and towns. The Department acknowledges that in all other situations,
interpretation of the Model City Tax Code is the sole purview of Municipal Tax Code
Commission or its designee. Designated persons must be authorized to receive confidential
information as authorized by Section 3.1 of this agreement. The Department shall include
at least two representatives of the municipalities as regular members of any group
established to respond to taxpayer ruling requests and to issue uniform interpretations and
guidance promulgated by the Department.This section is not intended to affect procedures
for appeals and litigation as outlined in Section 4.5 and Section 8 of this agreement.
11. Financing Collection of Taxes
The costs incurred by the Department in administering this Agreement shall be financed
through the State general fund appropriation to the Department. This provision does not
relieve City/Town of any financial obligation imposed by statute.
12. Inter-Jurisdictional Transfers
The Department shall administer the inter jurisdictional transfers of Municipal Tax
monies in accordance with the Standard Inter-Jurisdictional Transfer Process Map.
13. Education and Outreach Efforts
Page 14 of 22
February 2019
To further its focus on serving taxpayers and to commitment of funding Arizona's future
through enhanced customer service, continuous improvement, innovation, the Department
is also expanding its outreach and education program to connect with all citizens of
Arizona, strategically working with taxpayer and industry groups, tax practitioners and
Arizona's Cities and Towns to ensure tax education of individual and business taxpayers.
Any City/Town may further this mission, at its own expense, in providing education and
outreach to taxpayers and business. Education and Outreach shall be consistent with
applicable law and Department written guidance.
Increased Education and Outreach Efforts among the Department and the Cities/Towns
will ensure collaborative partnerships that are beneficial to both that emphasizes an
ongoing two-way exchange of information and communication on issues of common
interest and is meant to promote cooperation in areas of overlapping special projects.
Therefore, upon request, City/Town shall provide information to the Department
concerning such education and outreach efforts.
The Department shall implement the workings of an Ambassador Program; whereby, the
Department provides structure/support of curriculum for education related to tax
administration and compliance. The City/Town will have a standard work process when
participating in ADOR-led educational events.
The City/Town shall have a dedicated primary point of contact (PPOC) on its list of duly
authorized representatives, who is located in Arizona and is tasked with sending and
receiving communications between the ADOR and the Cities/Towns.
14. State & Municipal Audit Resolution Team ("SMART")
14.1 Members: The members shall consist of four seats representing municipal taxing
jurisdictions and four seats representing the Department.Member seats may be split
so some people fill the position for only certain issues, such as audit selection or
collection abatement. There shall also be a list of alternate members, who may be
asked by a regular member who is unable to attend a meeting to take that member's
place at a SMART meeting.
14.2 Selection: The Director of the Department shall appoint people to serve as
members of SMART. Municipal taxing jurisdictions shall nominate members from
municipal taxing jurisdictions.
14.3 Meetings: SMART shall meet monthly unless there is no business to be conducted.
Additional meetings can be scheduled as necessary to timely discuss issues
presented. Alternate members may attend meetings but cannot vote unless filling
the seat of a regular member.
14.4 Issues: The Department or City/Town may refer issues to SMART to include, but
not limited to:
Page 15 of 22
February 2019
(a) Decisions by the Department to not audit a taxpayer;
(b) Amendments to Department audit procedures or manuals;
(c) Closing Agreements or a range of settlement authority;
(d) Abatement or account closure in collections;
(e) Suspension of disclosure of information from the Department;
(f) Unresolved disagreement regarding proposed changes to process maps listed
in Sections 1.16, 1.17 and 1.18;
(g) Revocation of collection authority; and
(h) Other issues as authorized by the Director of the Department or agreed upon
by the parties.
14.5 Recommendations: SMART shall make recommendations to the Director of the
Department or Director's designee. If the recommendation is approved by at least
five members of SMART,the Director will accept the recommendation of SMART.
If SMART cannot reach a recommendation agreeable to at least five members of
the group, the Director or Director's designee may act as he deems to be in the best
interests of all parties. Notwithstanding the above, upon request by a City/Town,
the Director will submit his decision to the Attorney General's Office for review.
14.6 Voting: Any voting member of the committee may request the vote be held by
secret ballot.
14.7 Procedures: SMART shall develop procedures concerning the operation of the
group consistent with this Agreement.
15. Funding of Additional Auditors by City/Town
15.1 Funding: At the sole discretion of City/Town, City/Town may contribute funding
to the Department to pay for additional auditors to assist the Department in the
performance of audits of Municipal Tax owed to City/Town. Such additional
auditors funded by City/Town shall at all times be deemed to be employees of the
Department and under no circumstances shall be deemed to be employees or agents
of City/Town. It is the parties' intention that City/Town funding be used to increase
the capabilities of the Department to perform Municipal Tax audits and not to
subsidize or replace State funding required for audit and collection of taxes.
15.2 Use of Funds: City/Town funding for additional auditors under this Section shall
be used to fund the auditors' salaries and related expenses and shall not be used to
Page 16 of 22
February 2019
pay for Department office space, utilities, equipment, supplies, or similar kinds of
overhead.
15.3 Pool of Funds: The Department may pool any City/Town funding with any other
similar funding provided by other municipal taxing jurisdictions to pay for
additional auditors dedicated to serving those jurisdictions. The Department shall
separately account for such funds in its annual budget.
15.4 Accounting: The Department shall provide an annual accounting to City/Town,by
August 31 each year describing how City/Town funding was used during the prior
fiscal year.
16. Satellite Offices for Department Auditors
16.1 Funding: City/Town, at its own expense and at its sole discretion,may provide one
or more satellite offices and associated amenities for use by Department employees
to provide audit and/or customer service to taxpayers. Use of such facilities by
Department employees shall be at the sole discretion of the Department. Nothing
in this section shall require the Department to make use of such facilities provided
by City/Town.
16.2 Requirements:Any Department employee using a City/Town satellite office must
meet reasonable requirements of City/Town related to the use of the facility.
City/Town shall be responsible for notifying the Department of any concerns, and
the Department shall be responsible for taking appropriate actions to resolve those
concerns.
16.3 Termination: Once a satellite office is established, City/Town shall provide at least
180 calendar days written notice to the Department prior to the termination or
relocation of a satellite office.The Department may discontinue the use of a satellite
office at any time upon notice to City/Town and shall promptly remove all
Department property.
16.4 License:All requirements of City/Town and the Department related to the satellite
office shall be outlined in a mutually acceptable form of license and subject to
separate approval.
17. Non-availability of Funds
Every payment obligation of the Department and the City/Town pursuant to this Agreement
is conditioned upon the availability of funds appropriated or allocated for the payment of
such obligation, except for the rendering of funds to City/Town paid by a taxpayer for
Municipal Taxes or tax license fees of City/Town. If funds are not appropriated, allocated
and available or if the appropriation is changed resulting in funds no longer being available
Page 17 of 22
February 2019
for the continuance of this Agreement, this Agreement may be terminated at the end of the
period for which funds are available. No liability shall accrue to the State in the event this
provision is exercised,and the State shall not be obligated or liable for any future payments
or for any damages as a result of termination under this Section. The termination of this
Agreement shall not entitle the Department to retain any Municipal Tax collected on behalf
of City/Town pursuant to this Agreement.
18. Waiver
Nothing in this Agreement should be interpreted as City/Town relinquishing its legal rights
under the Arizona Constitution or other applicable law, nor that City/Town is conceding
the administration and collection of its Municipal Tax is not of a local interest or should
not be under local control.
19. Cancellation
The requirements of A.R.S. § 38-511 apply to this Agreement. The Department or
City/Town may cancel this Agreement, without penalty or further obligation, if any person
significantly involved in initiating, negotiating, securing, drafting or creating this
Agreement on behalf of the Department or City/Town is, at any time while this Agreement
or any extension is in effect, an employee, agent or consultant of the other party with
respect to the subject matter of this Agreement. The obligation of the Department to remit
City/Town taxes shall survive cancellation.
20. Notice
(a) When any Notice to City/Town is required under the terms of this Agreement, such
Notice shall be sent by electronic correspondence to:
Town of Fountain Hills
Finance Director
16705 E Avenue of the Fountains
Fountain Hills,AZ 85268
David Pock, Finance Director, email: dpock@h.az.gov
(b) When any Notice to the Department is required under the terms of this Agreement,
such Notice shall be sent by electronic correspondence to: cityservices@azdor.gov.
Page 18 of 22
February 2019
21. Non-discrimination
The Department and City/Town shall comply with Executive Order 2009-9, which
mandates all persons, regardless of race, color, religion, sex, age, or national origin, shall
have equal access to employment opportunities, and all other applicable State and Federal
employment laws, rules, and regulations, including the Americans with Disabilities Act.
The Department and City/Town shall take affirmative action to ensure applicants for
employment and employees are not discriminated against due to race,creed,color,religion,
sex,national origin or disability.
22. Compliance with Immigration Laws and A.R.S. § 41-4401
22.1 The Department and City/Town shall comply with all Federal immigration laws
and regulations relating to employees and warrants compliance with A.R.S. § 23-
214(A)which reads in part: "After December 31,2007,every employer, after hiring
an employee, shall verify the employment eligibility of the employee through the
e-verify program."
22.2 A breach of compliance with immigration laws and regulations shall be deemed a
material breach of this Agreement and may be grounds for the immediate
termination of this Agreement.
22.3 The Department and City/Town retain the legal right to inspect the papers of any
employee who works on the Agreement to ensure the Department and City/Town
is complying with the applicable Federal immigration laws and regulations and
State statutes as set forth above.
23. Audit of Records
City/Town and the Department shall retain all data, books, and other records ("Records")
relating to this Agreement for at least six (6) years (a) after termination of this Agreement,
and (b) following each annual renewal thereof All Records shall be subject to inspection
by the Department at reasonable times. Upon request,the Department and City/Town shall
produce any or all such records. This Agreement is subject to A.R.S. §§ 35-214 and-215.
24. Amendments
Any amendments to the enumerated provisions or Appendices A, B, and C of this
Agreement must be executed in writing in accordance with the provisions of this
Agreement. The Standard Process Maps described within certain enumerated provisions
are not themselves part of the Agreement.
Page 19 of 22
February 2019
25. Mutual Cooperation
In the event of a disagreement between the parties with regard to the terms,provisions and
requirements of this Agreement or in the event of the occurrence of any circumstances
bearing upon or affecting this Agreement, parties hereby agree to mutually cooperate in
order to resolve the said disagreement or deal with the said circumstance.
26. Arbitration
To the extent required by A.R.S. § 12-1518(B) and as provided for in A.R.S. § 12-133, the
parties agree to resolve any dispute arising out of this Agreement by arbitration.The parties
agree that any lawsuit filed by City/Town relating to the issues outlined in Section 17 of
this Agreement is not considered to be a dispute arising out of this Agreement.
27. Implementation
The implementation and execution of the provisions of this Agreement shall be the
responsibility of the Director of the Department or his representative and the Mayor his/her
designee, or another party with designated authority pursuant to applicable law or
City/Town charter on behalf of City/Town.
28. Limitations
Nothing in this Agreement shall be construed as limiting or expanding the statutory
responsibilities of the parties in performing functions beyond those granted to them by law,
or as requiring the parties to expend any sum in excess of their appropriations.
29. Duration
29.1 The term of this Agreement shall commence from the latest date as indicated in
Section 32 and continue in force through December 31st of that same year unless
canceled or terminated as provided herein. The term of the Agreement shall
automatically be extended for successive one (1) year terms commencing on
January 1st and ending on December 31st of each year thereafter unless canceled
or terminated as provided herein. Amendments to this Agreement that are
negotiated and agreed to by a simple majority of the review committee referenced
in Section 29.5 shall thereafter be executed by the parties hereto by a separate,
signed amendment and incorporated herein to be effective during the term of the
Agreement and any extensions. This Agreement may be canceled or terminated
effective on December 31st of any year by either party by providing written notice
Page 20 of 22
February 2019
no later than sixty (60) calendar days prior to the expiration of the term then in
effect. This Agreement shall expire on December 31st of any year the Department
is subject to sunset review. Upon expiration, cancellation or termination, any
subsequent Agreement must be ratified through signature by both parties.
29.2 If State legislation enacted subsequent to the date of this Agreement substantially
affects the performance of this Agreement by either party or substantially
diminishes the benefits either party would receive under this Agreement, either
party may then terminate this Agreement by giving at least thirty calendar days'
notice to the other party. The termination will become effective immediately upon
the expiration of the notice period unless otherwise agreed to by the parties.
29.3 Notwithstanding any provision to the contrary herein, both parties may by mutual
agreement provide for the termination of this contract upon such terms and at such
time as is mutually agreeable to them.
29.4 Any notice of termination shall be mailed and served on the other party in
accordance with Section 20 of this Agreement.
29.5 During the term of this Agreement,the terms and conditions of this Agreement will
undergo an annual review to be initiated no later than June 1st of each year. The
review will be performed by a committee made up of equal parts representatives of
the Department and representatives of the municipal taxing jurisdictions entering
into an IGA with the Department for the administration and collection of Municipal
Taxes.
30. Choice of Law
The laws and regulations of the State of Arizona shall govern the rights of the parties, the
performance of this Agreement, and any disputes arising from this Agreement.
31. Entire Agreement
This document, including the specific appendices attached hereto, and any approved
subcontracts, amendments and modifications made thereto, shall constitute the entire
Agreement between the parties and shall supersede all other understandings, oral or
written.
32. Signature Authority
Page 21 of 22
February 2019
32.1 By signing below, the signer certifies he or she has the authority to enter into this
Agreement on behalf of his or her respective party, and he or she has read the
foregoing and agrees to accept the provisions herein on said party's behalf.
32.2 This Intergovernmental Agreement may be executed in counterpart.
q4.'V‘-'-"s":1Signature Date Signature I Date
Grant Niille, Deputy Director Ginny Dickey, Mayor
Typed Name and Title Typed Name and Title
Arizona Department of Revenue Town of Fountain Hills
Entity Name Entity Name
1600 W. Monroe 16705 E Avenue of the Fountains
Address Address
Phoenix Arizona 85007 Fountain Hills Arizona 85268
City State Zip City State Zip
RESERVED FOR THE ATTORNEY GENERAL: RESERVED FOR CITY/TOWN ATTORNEY:
This agreement between public agencies has been APPROVED AS TO FORM AND AUTHORITY:
reviewed pursuant to A.R.S. § 11-952 by the
undersigned Assistant Attorney General who has
determined that it is in proper form and is within the B .
powers and authority granted under the laws of the CIT WN ATTORNEY
State of Arizona to the Arizona Department of
Revenue represented by the Attorney General. Date: G6/044/19
MARK BRNOVICH
The Attorney General
Signature
Assistant Attorney General
Date:
Page 22 of 22
February 2019
APPENDIX A
ARIZONA DEPARTMENT OF REVENUE
CONFIDENTIALITY REQUIREMENTS
1. Confidential Information
1.1 Confidential Information is defined in A.R.S § 42-2001. Confidential Information may
not be disclosed except as provided by statute. A.R.S. § 42-2001(B).
1.2 License information obtained from the Department of Revenue is Confidential
Information and may only be disclosed as authorized by A.R.S. § 42-2003. License
information obtained from other sources is not Confidential Information.
1.3 Information about a taxpayer's identity obtained from the Department of Revenue is
Confidential information and may only be disclosed as authorized by A.R.S. § 42-2003.
Identity information obtained from other sources is not Confidential Information.
1.4 Confidential Information includes information about a single taxpayer and also
aggregated information about a group of identified or identifiable taxpayers. Aggregated
information from fewer than three taxpayers in a grouping on a statewide basis or fewer
than ten taxpayers in a grouping for an area that is less than state level (city or town) may
be Confidential Information. Such information may not be released unless the City/Town
Administrator reviews the relevant information concerning the aggregate data and makes
a determination in writing that the aggregate data does not reveal information about any
specific taxpayer. Such determination should take into consideration the following:
a. The proportionality of the tax information applicable to individual members of the
group of taxpayers; no individual taxpayer's information should be discernable due
to its relative size/taxable sales, compared to other members of the group;
b. The total aggregated tax information; the aggregate information cannot allow
viewers to draw conclusions about individual taxpayers (e.g., there are 6 car
dealers in the city and the total aggregate sales were $900,000 and none of them
reported individual sales above the $20,000 mark, which would have qualified for
the lower tax rate on large purchases)
c. Any other factor that could cause the aggregate data to be used to determine
information specific to a single taxpayer.
2.Protecting Information
2.1 City/Town must identify all places, both physical and logical, where Confidential
Information is received, processed and stored and create a plan to adequately secure those
areas.
2.2 Confidential Information must be protected during transmission, storage, use, and
destruction. City/Town must have policies and procedures to document how it protects
its information systems, including Confidential Information contained therein. An
example of appropriate protection standards is set forth in National Institute of Standards
and Technology Special Publication 800-53. The publication may be found at
http://nvlpubs.nist.gov/nistpubs/SpecialPublications/NIST.SP.800-53r4.pdf
2.3 Employees are prohibited from inspecting information unless they have a business reason
for the information. Browsing information concerning friends, neighbors, family
members, or people in the news is strictly prohibited.
2.4 All removable media, including paper and CDs, containing Confidential Information
must be secured when not in use and after normal business hours by placing all materials
in a locked drawer or cabinet. During use, Confidential Information must be protected so
that it is not visible to members of the public or anyone without a business need for the
information.
2.5 All individuals accessing or storing Confidential Information from an alternative work
site must enter into a signed agreement that specifies how the Confidential Information
will be protected while at that site. Only trusted employees shall be permitted to access
Confidential Information from alternative sites. Confidential Information may not be
accessed while in public places such as restaurants, lounges, or pools.
2.6 Confidential Information may not be sent outside the local area network by unencrypted
email. City/Town is responsible for ensuring in-flight email communications containing
Confidential Information are sent through a secure process. This may include encryption
of the email message, a secure mailbox controlled by City/Town, an encrypted point-to-
point tunnel between the correspondents or use of Transport Layer Security (TLS)
between correspondents.
2.7 Confidential Information may not be discussed in elevators, restrooms, the cafeteria, or
other public areas. Computer terminals should be placed in such a manner that prohibits
public viewing of Confidential Information.
2.8 When transporting confidential materials the materials should be covered so that others
cannot see the Confidential Information. When sending Confidential Information by fax
a cover sheet should always be used.
2.9 Any person with unsupervised access to Confidential Information shall receive training
on the confidentiality laws and requirements to protect such information before being
given access to such Information and annually thereafter. They must sign certificates
after the training acknowledging that they understand their responsibilities. City/Town
must keep records to document this training and certification.
3.Disclosure of Information
3.1 Confidential Information may only be disclosed as permitted by A.R.S. § 42-2003.
3.2 Confidential Information is confidential by statute and, therefore, does not have to be
disclosed in response to a public records request. A state agency may deny inspection of
public records if the records are confidential by statute. Berry v. State, 145 Ariz. 12, 13
699 P.2d 387, 388 (App. 1985).
3.3 A taxpayer may designate a person to whom Confidential Information may be disclosed
by completing a Department of Revenue Form 285, or such other form that contains the
information included in the Form 285. City/Town may contact the Department of
Revenue's Disclosure Officer if there are any questions concerning this requirement.
4. Disposal of Information
4.1 All removable media containing Confidential Information must be returned to the
Department of Revenue or sanitized before disposal or release from the control of
City/Town.
4.2 Paper copies of Confidential Information must be destroyed by shredding or burning the
materials when no longer needed. Confidential Information may not be disposed of by
placing the materials in the garbage or recycle bins. Destruction of Confidential
Information may be performed by a third party vendor. City/Town must take appropriate
actions to protect the Confidential Information in transit and storage before it is
destroyed, such as periodic inspections of the vendor.
4.3 Computer system components and devices such as copiers and scanners that have been
used to store or process Confidential Information may not be repurposed for non-tax
administration uses unless the memory or hard drive of the device is sanitized to ensure
under no circumstances Confidential Information can be restored or recovered.
5. Storing Data
5.1 Confidential Information may be stored on hard disks only if agency approved security
access control devices (hardware/software) have been installed, are receiving regularly
scheduled maintenance including upgrades, and are being used. Access controls must
include password security, an audit trail, encryption, virus detection, and data overwriting
capabilities.
6. Encryption Requirements and Cryptographic Module Authentication
6.1 The City/Town information system must implement mechanisms for the authentication to
a cryptographic module that meets the requirements of applicable federal laws, Executive
Orders, directives,policies, regulations, standards, and guidance for such authentication.
6.2 Validation provides assurance that when an agency implements cryptography to protect
Confidential Information, the encryption functions have been examined in detail and will
operate as intended.
6.3 All electronic transmissions of Confidential Information must be encrypted using FIPS
140-2 validated cryptographic modules. A product does not meet the FIPS 140-2
requirements by simply implementing an approved security function. Only modules
tested and validated to FIPS 140-2 meet the applicability requirements for cryptographic
modules to protect sensitive information.NIST maintains a list of validated cryptographic
modules on its website http://csrc.nist.gov/
6.4 Confidential Information is required to be protected in transit and at rest. City/Town is
requested to adhere to the following guidelines to use encryption:
• Encrypt the compressed file using Advanced Encryption Standard.
• Compress files in .zip or.zipx formats.
• Use a strong 256-bit encryption key string.
• Ensure a strong password or pass phrase is generated to encrypt the file.
• Communicate the password or pass phrase with the Department of Revenue
through a separate email or via a telephone call to your DOR contact person. Do
not provide the password or passphrase in the same email containing the
encrypted attachment.
6.5 Refer to your specific file compression software user guide for instructions on how to
compress and encrypt files. Known compatible products with DOR include but are not
limited to WinZip and Secure Zip.
6.6 Please remember, while the attachment is encrypted, the content of the email message
will not be encrypted, so it is important that any sensitive information be contained in the
attachment(encrypted document).
7. Wireless Access (if accessing State Confidential Information from a wireless network)
7.1 City/Town must:
• Establish restrictions, configuration/connection requirements, and implementation
guidance for wireless access.
• Authorize wireless access to the information system prior to allowing such
connections.
• Employ a wireless intrusion detection system to identify rogue wireless devices
and to detect attack attempts and potential compromises/breaches to the
information system.
8. Interconnection Security Agreement
8.1 Trusted Behaviors. The City/Town system and users are expected to protect ADOR's data
in accordance with applicable state and federal laws.
8.2 Data Flows. The City/Town is responsible for creating architectural diagrams of any
systems connecting to ADOR systems and depicting the flow of State Confidential
Information.
8.3 Audit Trail Responsibilities. City/Town is responsible for auditing application processes
and user activities involving any information interconnection. Activities that will be
recorded include event type, date and time of event, user identification, workstation
identification, success or failure of access attempts, and security actions taken by system
administrators or security officers. Audits, and/or security actions taken by system
administrators or security officers will be recorded and available for review by ADOR.
8.4 Incident Reporting. City/Town is required to notify ADOR in the event of data loss,
breach, or security concern regarding ADOR's Confidential Information by reporting the
incident to the ADOR Information Security Team by phone at (602) 716-6166 or email at
InfoSec@azdor.gov.
8.5 DOR may send employees or auditors to inspect any of City/Town information systems
and/or facilities used to process, store or transmit any ADOR data at any time to ensure
that ADOR information is adequately protected.
APPENDIX B
From the effective date of this Agreement until the new functionalities set forth below are
implemented,the Department of Revenue will provide the following reports:
City Payment Journal Detail;
City Payment Journal Summary;
New License Report
Within 30 days after the first month's implementation of the JT2,the Department of Revenue
will provide a new License Report and License Update Report containing at least the following
fields:
NEW LICENSE REPORT AND LICENSE UPDATE REPORT
Fields displayed:
o Region Code
o Run Date
o Report Start Date
o Report End Date
o Update Date
o ID Type
o ID
o Account ID
o Entity Name
o Ownership Type
o License ID
o OTO/Applied For indicator
o Bankruptcy Indicator
o Filing Frequency
o Issue Date
o Account Start Date
o Business Start Date
o Arizona Start Date
o Doc Loc Nbr
o Accounting Method
o Close Date
o Close Code
o Business Description
o NAICS1
o NAICS2
o NAICS3
o NAICS4
o Mailing Street 1
o Mailing Street2
o Mailing Street3
o Mailing City
o Mailing State
o Mailing ZIP
o Mailing Country
o Mailing Phone Number
o Mailing Address Add date
o Mailing Address End Date
o Audit Streetl
o Audit Street 2
o Audit Street 3
o Audit City
o Audit State
o Audit Zip
o Audit Country
o Audit Phone Number
o Audit Address Add Date
o Audit Address End Date
o Location Code
o Business Codes
o Location Name (DBA)
o Number of Units
o Location Street 1
o Location Street 2
o Location Street 3
o Location City
o Location State
o Location Zip
o Location Country
o Location Phone Number
o Location Start Date
o Location End Date
o Primary Location Street 1
o Primary Location Street 2
o Primary Location Street 3
o Primary Location City
o Primary Location State
o Primary Location Zip Code
o Primary Location Country
o Primary Location Phone Number
o Primary Location Start Date
o Primary Location End Date
o Owner Name
o Owner Title
o Owner Name 2
o Owner Title 2
o Owner Name 3
o Owner Title 3
Within 30 days of the implementation of the TPT2,the Department of Revenue will provide the
following reports with at least the fields indicated below:
CITY PAYMENT JOURNAL
o Run Date
o Report Start Date
o Report End Date
o GL Accounting Period
o Period End Date
o Payment received date
o Return received date
o Payment process date
o Return process date
o Filing Frequency
o License ID
o Entity Name
o Location Code
o Location Name (DBA)
o Location Street 1
o Location Street 2
o Location Street 3
o Location City
o Location State
o Location Zip
o Location Country
o NAICS
o Business Code
o Doc Loc Nbr
o Pmt Loc Nbr
o Gross Receipts
o Total Deductions
o Tax or Fee Collected
o P & I Collected
o Audit Collections
o Tran Type
o Tran Subtype
o Rev Type
CITY PAYMENT JOURNAL SUMMARY
o Region Code
o Run Date
o Report Start Date
o Report End Date
o GL Accounting Period
o Business Code
o Number of Accounts
o Collections
Within 30 days after the first month's implementation of the TPT2,the following reports with at
least the fields indicated below:
NO MONEY REPORT
o Region Code
o GL Accounting Period
o Period End Date
o Payment received date
o Return received date
o Payment process date
o Return process date
o Filing Frequency
o License ID
o Entity Name
o Location Code
o Location Name (DBA)
o Location Street 1
o Location Street 2
o Location Street 3
o Location City
o Location State
o Location Zip
o Location Country
o NAICS
o Business Code
o Doc Loc Nbr
o Pmt Loc Nbr
o Gross Receipts
o Total Deductions
o Tax or Fee Collected
o P & I Collected
o Audit Collections
o Tran Type
o Tran Subtype
DEDUCTION REPORT
o Region Code
o Run Date
o Report Start Date
o Report End Date
o GL Accounting Period
o Period End Date
o License ID
o Entity Name
o Location Code
o Location Name (DBA)
o Business Code
o Doc Loc Nbr
o Deduction Code
o Deduction Amount
o Tran Type
o Tran Subtype
o Rev Type
Within 30 days after taxes (subject to fund distributions) are collected,the Department of
Revenue will provide the following report with at least the fields indicated below:
FUND DISTRIBUTION REPORT
o Region Code
o Run Date
o Report Start Date
o Report End Date
o GL Accounting Period
o Period End Date
o Payment Received Date
o Return Received Date
o Payment Processed Date
o Return Processed Date
o License ID
o Entity Name
o Location Code
o Location Name (DBA)
o Business Code
o Doc Loc Nbr
o Fund Allocation Code
o Amount Distributed
FUND DISTRIBUTION SUMMARY REPORT
o Region Code
o Run Date
o Report Start Date
o Report End Date
o GL Accounting Period
o Fund Allocation Code
o Amount Distributed
JT-1/UC-001(1/18)
ARIZONA JOINT TAX APPLICATION (JT-1)
IMPORTANT! Incomplete applications WILL NOT BE PROCESSED.
.%coo° • Please read form instructions while completing the application.
"_ Additional information and forms available at www.azdor.gov
Customer Care and Outreach • * , You can register,file
ARIZONA DEPARTMENT OF REVENUE Required information is designated with an asterisk( )
• Return completed application AND applicable license fee(s)to and pay for this
PO BOX 29032 application online at
Phoenix,AZ 85038-9032 address shown at left.
• For licensing questions regarding transaction privilege tax,call www.AZTaxes.gov.
It is fast and secure.
Customer Care and Outreach:(602)255-3381
SECTION A: Business Information
1* Federal Employer Identification Number 2* License Type—Check all that apply:
or Social Security Number,required if sole proprietor
with no employees ❑Transaction Privilege Tax(TPT) ❑ Use Tax
❑Withholding/Unemployment Tax(if hiring employees) ❑TPT for Cities ONLY
3* Type of Organization/Ownership—Tax exempt organizations must attach a copy of the Internal Revenue Service's letter of detemtination.
❑ Individual/Sole Proprietorship ❑Subchapter S Corporation ❑Government ❑Joint Venture
❑Corporation ❑Association ❑ Estate ❑Receivership
State of Inc. ❑ Partnership ❑Trust
Date of Inc. ❑ Limited Liability Company ❑ Limited Liability Partnership
4* Legal Business Name
5* Mailing Address—number and street City State ZIP Code
J I I
County/Region Country
6* Business Phone No.(with area code) 7 Email Address 8 Fax Number(with area code)
9* Description of Business: Describe merchandise sold or taxable activity.
10*NAICS Codes: Available at www.azdor.gov
11*Did you acquire or change the legal form of an existing business? 12*Are you a construction contractor?
❑ No ❑Yes 4 You must complete Section F. ❑ No ❑Yes(see bonding requirements)
BONDING REQUIREMENTS: Prior to the issuance of a Transaction Privilege Tax license, new or out-of-state contractors are required to post a Taxpayer Bond for
Contractors unless the contractor qualifies for an exemption from the bonding requirement.The primary type of contracting being performed determines the amount of bond
to be posted.Bonds may also be required from applicants who are delinquent in paying Arizona taxes or have a history of delinquencies.Refer to the publication,Taxpayer
Bonds,available online at www azdor.gov or in Arizona Department of Revenue offices.
WITHHOLDING LICENSE ONLY
13*Withholding Physical Location City State ZIP Code
Number and street(Do not use PO Box,PMB or route numbers)
1 I I
County/Region Country
Continued on page 2 4
FOR AGENCY USE ONLY CASHIER'S STAMP ONLY. DO NOT MARK IN THIS AREA.
ACCOUNT NUMBER DLN
❑ New START TRANSACTION PRIVILEGE TAX
❑ Change S/E DATE WITHHOLDING/SSN/EIN
❑ Revise COMPLETED DATE EMPLOYEE'S NAME
❑ Reopen LIABILITY LIABILITY ESTABLISHED
ADOR 10196(1118)
JT-1/UC-001(1/18)
Name(as shown on page 1) FEIN or SSN(as shown on page 1)
SECTION B: Identification of Owners, Partners, Corporate Officers Members/Managing Members
or Officials of this Employing Unit
If you need more space,attach Additional Owner,Partner,Corporate Officer(s)form available at wwwazdorgov. If the owner,partners,corporate officers or combination of
partners or corporate officers,members and/or managing members own more than 50%of or control another business in Arizona,attach a list of the businesses,percentages
owned and unemployment insurance account numbers or provide a Power of Attorney(Form 285)which must be filled out and signed by an authorized corporate officer.
*Social Security No. *Title *Last Name First Name Middle Intl.
I I
y *Street Address *City *State *%Owned
O• *ZIP Code *County *Phone Number(with area code) *Country
*Social Security No. *Title *Last Name First Name Middle Intl.
cNi I I
*Street Address *City *State *%Owned
O• *ZIP Code *County *Phone Number(with area code) *Country
*Social Security No. *Title *Last Name First Name Middle Intl.
0 I I
d *Street Address *City *State *%Owned
O *ZIP Code *County *Phone Number(with area code) *Country
SECTION C: Transaction Privilege Tax(TPT)
1* Date Business Started in Arizona 2* Date Sales Began 3 What is your Estimated Tax Liability for your first twelve months of business?
I , , I I _
4 Filing Frequency ❑ Monthly ❑Quarterly ❑Seasonal 0 Annual If seasonal filer,check the months for which you intend to do business:
❑JAN ❑ FEB 0 MAR ❑APR ❑ MAY ❑JUN ❑JUL ❑AUG ❑SEP 0 OCT 0 NOV ❑ DEC
5 Does your business sell tobacco products? 6 TPT Filing Method 7 Does your business sell new motor vehicle tires or vehicles?
❑Yes 4 ❑ Retailer OR❑ Distributor ❑Cash Receipts ❑Yes 4 You will have to file Motor Vehicle Tire Fee form
❑Accrual available at www.azdor.gov
8* Tax Records Physical Location—number and street City State ZIP Code
(Po no(use PO Box,PMB or route numbers)
I I
County Country
9* Name of Contact *Phone Number(with area code) Extension
SECTION D: Transaction Privilege Tax(TPT) Physical Location
1* Business Name,"Doing Business As"or Trade Name at this Physical Location 2* Phone Number(with area code)
3* Physical Location of Business or Commercial/Residential Rental City State ZIP Code
Number and street(Do not use PO Box,PMB or route numbers)
I I
County/Region Country
Residential Rental Only—Number of Units Reporting City(if different than the physical location city)
4* Additional County/Region Indian Reservation/City: County/Region Indian Reservation and City Codes available at www.azdor.gov
County/
Region I City
Business Codes (Include all codes that apply): See instructions. Complete list available at www.azdor.gov
State/ I I I I I City
County
If you have more locations,attach Additional Business Locations form available at www azdor.gov
ADOR 10196(1/18) ARIZONA JOINT TAX APPLICATION(JT-1) Page 2 of 4
JT-1/UC-001(1/18)
Name(as shown on page 1) FEIN or SSN(as shown on page 1)
SECTION E: Withholding & Unemployment Tax Applicants
1* Regarding THIS application, Date Employees First Hired in Arizona 2 Are you liable for Federal Unemployment Tax?
I I ❑Yes 4 First year of liability:
3 Are individuals performing services that are excluded from withholding 4 Do you have an IRS ruling that grants an exclusion from
or unemployment tax? Federal Unemployment Tax?
❑Yes 4 Describe services: ❑Yes 4 Attach a copy of the Ruling Letter.
5 Do you have,or have you previously had,an Arizona unemployment tax number?
❑No Unemployment Tax Number:
❑Yes 4 Business Name: ,
6 First calendar quarter Arizona employees were/will be hired and paid Hired Year Hired Quarter Paid Year Paid Quarter
(indicate quarter as 1,2,3,4):
7 When did/will you first pay a total of$1,500 or more gross wages in a calendar quarter? Year Quarter
(indicate quarter as 1,2,3,4)
Exceptions:$20,000 gross cash wages Agricultural;$1,000 gross cash wages Domestic/Household;not applicable to 501(c)(3)Non-Profit.
8 When did/will you first reach the 20th week of employing 1 or more individuals for some portion of a day in Year Quarter
each of 20 different weeks in the same calendar year?(indicate quarter as 1,2,3,4)
Exceptions:10 or more individuals Agricultural;4 or more individuals 501(c)(3)Non-Profit;not applicable to Domestic/Household.
SECTION F: Acquired Business Information
If you answered"Yes"to Section A, question 11, you must complete Section F.
1* Did you acquire or change all or part of an existing business? 2* Date of Acquisition 3* EIN of Business Under Previous Owner
❑All
❑Part 1 . 1 . ,
4* Previous Owner's Telephone Number 5* Name of Business Under Previous Owner 6* Name of Previous Owner
7* Did you change the legal form of all or part of the Arizona operations of 8* Date of Change 9* EIN of Previous Legal Form
your existing business?(e.g.,change from sole proprietor to corporation or etc.)
❑All
❑ Part
SECTION G: AZTaxes.gov Security Administrator
Visit www.AZTaxes.gov(the Arizona Department of Revenue's online customer service center)to register for online services.The authorized individual will
have full online access to transaction privilege,use,withholding and corporate tax account information and services.The authorized individual will be able
to add or delete users and grant user privileges.Online services include viewing tax account information,filing tax returns,signing returns electronically
with a Self-Select Personal Identification Number(PIN)and remitting tax payments.
SECTION H: Required Signatures
This application must be signed by either a sole owner,at least two partners,managing member or corporate officer legally responsible for the business,
trustee or receiver or representative of an estate that has been listed in Section B.
1 Print or Type Name 2 Print or Type Name
Title Title
Date Date
Signature Signature
This application must be completed, signed,and returned as provided by A.R.S. §23-722.
Equal Opportunity Employer/Program
This application is available in alternative formats at Unemployment Insurance Tax Office.
PLEASE COMPLETE SECTION I: STATE/COUNTY&CITY LICENSE FEE WORKSHEET
TO CALCULATE AND REMIT TOTAL AMOUNT DUE WITH THIS APPLICATION.
ADOR 10196(1/18) ARIZONA JOINT TAX APPLICATION(JT-1) Page 3 of 4
JT-1/UC-001(1/18)
Name(as shown on page 1) FEIN or SSN(as shown on page 1)
SECTION I: State/County &City License Fee Worksheet
ALL FEES ARE SUBJECT TO CHANGE. Check for updates at www.azdor.gov.
To calculate CITY FEE:Multiply No.of Locations by the License Fee and enter sum in License Subtotal.
No.of License License No.of License License No.of License License
City/Town Code Loc's Fee Subtotal City/Town Code Loc's Fee Subtotal City/Town Code Loc's Fee Subtotal
Apache Junction AJ $2.00 Goodyear GY $5.00 Sahuarita SA $5.00
Avondale AV $0.00 Guadalupe GU $2.00 San Luis SU $2.00
Benson BS $5.00 Hayden HY $5.00 Scottsdale SC $50.00
Bisbee BB $1.00 Holbrook HB $1.00 Sedona SE $2.00
Buckeye BE $2.00 Huachuca City HC $2.00 Show Low SL $2.00
Bullhead City BH $2.00 Jerome JO $2.00 Sierra Vista SR $1.00
Camp Verde CE $2.00 Kearny KN $2.00 Snowflake SN $2.00
Carefree CA $10.00 Kingman KM $2.00 Somerton SO $2.00
Casa Grande CG $2.00 Lake Havasu LH $5.00 South Tucson ST $2.00
Cave Creek CK $20.00 Litchfield Park LP $2.00 Springerville SV $5.00
Chandler CH $2.00 Mammoth MH $2.00 St.Johns SJ $2.00
Chino Valley CV $2.00 Marana MA $5.00 Star Valley SY $2.00 _
Clarkdale CD $2.00 Maricopa MP $2.00 Superior SI $2.00
Clifton CF $2.00 Mesa ME $20.00 Surprise SP $10.00
Colorado City CC $2.00 Miami MM $2.00 Taylor TL $2.00
Coolidge CL $2.00 Nogales NO $0.00 Tempe TE $50.00
Cottonwood CW $2.00 Oro Valley OR $12.00 Thatcher TC $2.00
Dewey/Humboldt DH $2.00 Page PG $2.00 Tolleson TN $2.00 _
Douglas DL $5.00 Paradise Valley PV $2.00 Tombstone TS $1.00
Duncan DC $2.00 Parker PK $2.00 Tucson TU $20.00
Eagar EG $10.00 Patagonia PA $0.00 Tusayan TY $2.00
El Mirage EM $15.00 Payson PS $2.00 Wellton _ WT $2.00
Eloy EL $10.00 Peoria PE $50.00 Wickenburg WB $2.00
Flagstaff FS $46.00 Phoenix" PX $50.00 Willcox WC $1.00
Florence FL $2.00 Pima PM $2.00 Williams WL $2.00
Fountain Hills FH $2.00 Pinetop/Lakeside PP $2.00 Winkelman WM $2.00
Fredonia FD $10.00 Prescott PR $5.00 Winslow WS $10.00
Gila Bend GI $2.00 Prescott Valley PL $2.00 Youngtown YT $10.00
Gilbert GB $2.00 Quartzsite QZ $2.00 Yuma YM $2.00
Glendale GE $35.00 Queen Creek QC $2.00
Globe GL $2.00 Safford SF $2.00
Subtotal City License Fees Subtotal City License Fees Subtotal City License Fees
(column 1) $ (column 2) $ (column 3) $
AA TOTAL City License Fee(s)(column 1 +2+3) $
Fee per
No.of Loc's Location TOTAL
BB TOTAL State License Fee(s): Calculate by multiplying number of business locations by$12.00 $12.00 $
Residential Rental License Fees-Only Chandler,Phoenix,and Scottsdale
Multiply the number of units per locations by$2.00($50.00 Annual Cap per license). No.of Units No.of Loc's City Fee
ONLY CHANDLER,PHOENIX,and SCOTTSDALE Residential Rental License-Chandler $
should use this section. Residential Rental License Phoenix $
DO NOT use the fee chart above to calculate license fees.
The amount for each city CANNOT EXCEED$50.00 Residential Rental License Scottsdale $
CC TOTAL City Residential Rental License Fees(Add Chandler,Phoenix,&Scottsdale) $
DD TOTAL DUE(Add lines AA+BB+CC) $
• Make check payable to Arizona Department of • Do not send cash.
Revenue. • License will not be issued without full payment of
• Include FEIN or SSN on payment. fee(s).
i **If your only business is under Class 213, Commercial Lease, there is no license fee due.
ADOR 10196(1/18) ARIZONA JOINT TAX APPLICATION(JT-1) Page 4 of 4
1.oiSHESTgrc^
""�°`"' � ARIZONA DEPARTMENT OF REVENUE
F.
GENERAL INSTRUCTIONS FOR ARIZONA JOINT TAX APPLICATION (JT-1)
*1912
Online Application
Go to www.AZTaxes.gov The Arizona Joint Tax Application (JT-1) is used to apply
for Transaction Privilege Tax, Use Tax, and Employer
Notice for Construction Contractors: Withholding and Unemployment Insurance. The Application
Due to bonding requirements, is called "Joint" because it is used by both the Department
construction contractors are not of Revenue and Economic Security.
permitted to license for transaction
privilege tax online. For more USE THIS APPLICATION TO:
information, please contact us.
• License New Business: If you are selling a product
Mailing Address or engaging in a service subject to transaction
Arizona Department Revenue privilege tax, you will most likely need to obtain the
PO Box 29032 state transaction privilege tax license (TPT) license.
Phoenix,AZ 85038-9032 • Change Ownership: If acquiring or succeeding to
all or part of an existing business or changing the
Customer Service legal form of your business (sole proprietorship to
Center Locations corporation, etc.).
8:00 a.m. — 5:00 p.m.
Monday through Friday IMPORTANT: To avoid delays in processing of your
(Except legal Arizona state holidays) application, we recommend you read these instructions
and refer to them as needed to ensure you have accurately
Phoenix Office entered all the required information. This application
1600 West Monroe must be completed, signed, and returned as provided
Phoenix, AZ 85007 by A.R.S. § 23-722.
Mesa Office
1840 South Mesa Drive • Please read form instructions while completing the
Building #1352 application. Additional information and forms are
Mesa, AZ 85201 available at www.azdor.gov.
(This office does not handle billing or account
disputes) • Required information is designated with an asterisk(*).
Tucson Office • Please complete Section I: State/County & City
400 West Congress License Fee Worksheet to calculate and remit Total
Tucson,AZ 85701 Amount Due with this application.
Customer Service When completing this form,please printortype in black ink.
Telephone Numbers Legible applications are required for accurate processing.
Licensing questions on Transaction The following numbered instructions correspond to the
Privilege, Withholding or Use Tax numbers on the Form JT-1.
(Arizona Department of Revenue)
(602) 255-3381 If you need to update a license,add a business location,
get a copy of your license, or make other changes:
Unemployment Tax Complete a Business Account Update form and include a
(Arizona Department of State fee of$12 per location and any applicable fees related
Economic Security) to locations within the City/Town jurisdictions. Additional
(602) 771-6602 information and forms are available at www.azdor.gov.
E-mail: uitstatus@azdes.gov
ADOR 10196(1/18) Instructions Page 1
ARIZONA JOINT TAX APPLICATION (JT-1) INSTRUCTIONS
Section A: BUSINESS INFORMATION home address, corporate headquarters, or accounting
1. Provide your Federal Employer Identification No. firm's address, etc. If mailing address differs for
(FEIN) or Social Security No. (SSN) if you are a sole licenses (for instance withholding and unemployment
proprietor without employees. Taxpayers are required insurance), please send a cover letter with completed
to provide their taxpayer identification number (TIN) application to explain.
on all returns and documents. A TIN is defined as the 6. Provide the Business Phone Number including the
federal employer identification number (EIN) or SSN, area code.
depending upon how income tax is reported. The EIN 7. Provide the Email Address for the business or contact
is required for all employers. A penalty of $5 will be person.
assessed by the Department of Revenue for each
document filed without a TIN. 8. Provide the Business Fax Number including the area
code.
2. License Type (Check all that apply):
9. Provide the Description of Business by describing the
Transaction Privilege Tax (TPT): Anyone engaged in major taxable business activity, principle product you
a business taxable under the TPT statutes must apply manufacture, commodity sold, or services performed.
for a TPT License before engaging in business. For Your description of business is very important and
TPT, you are required to obtain and display a separate MUST link to the appropriate NAICS Code and
license certificate for each business or rental location. Business Code.
This may be accomplished in one of the following ways:
• Each location may be licensed as a separate 10. Provide all North American Industries Classification
business with a separate license number for System (NAICS) Code(s) that apply. The NAICS is
purposes of reporting transaction privilege and use identified for your business, based on your major
taxes individually. Therefore, a separate application business activity, principle product you manufacture,
is needed for each location. commodity sold, or services performed. You must
• Multiple locations may be licensed under a indicate at least one NAICS code. A current listing is
consolidated license number, provided the ownership available at www.azdor.gov.
is the same, to allow filing of a single tax return. If 11. If you acquired or changed the legal name of an
applying for a new license, list the various business existing business, you must complete Section F of this
locations as instructed below. If already licensed and application. If you check NO, proceed to number 12.
you are adding locations,do not use this application 12. If you are a construction contractor, read bonding
to consolidate an existing license. Please submit requirements and submit the appropriate bonding
a Business Account Update form, available at paperwork with this application. If you check NO,
www.azdor.gov. proceed to number 13.
Withholding & Unemployment Taxes: Employers 13.Provide the Withholding Physical Location of the
paying wages or salaries to employees for services business. This address cannot be a PO Box or Route
performed in the State must apply for a Withholding Number.
number& Unemployment number.
Use Tax: Out-of-state vendors (that is, vendors with
no Arizona location) making direct sales into Arizona Section B: IDENTIFICATION OF OWNERS,
must obtain a Use Tax Registration Certificate. In-state PARTNERS, CORPORATE OFFICERS,
business not required to be licensed in Arizona for TPT MEMBERS/MANAGING MEMBERS OR
purposes, making out-of state purchases for their own OFFICIALS OF THIS EMPLOYING UNIT
use (and not for resale) must also obtain the Use Tax Provide the full name, social security number and title
registration. of all Owners, Partners, Corporate Officers, Members/
TPT for cities only: This type of license is needed if Managing Members or Officials of the Employing Unit. If
your business activity is subject to city TPT which is you need additional space, attach Additional Owners,
collected by the state, but the activity is not taxed at the Partners, Corporate Officer(s) Addendum available at
state level. www.azdor.gov. If the owner, partners, corporate officers or
3. Type of Organization/Ownership: Check as combination of partners or corporate officers,members and/
applicable. A corporation must provide the state and or managing members own more than 50% of, or control
date of incorporation. another business in Arizona, attach a list of the businesses,
4. Provide the Legal Business Name or owner or percentages owned and unemployment insurance account
corporation as listed in its articles of incorporation, numbers or provide a General Disclosure/ Power of
or individual and spouse, or partners, or organization Attorney(Form 285)which must be filled out and signed by
owning or controlling the business. an authorized corporate officer.
5. Provide the Mailing Address(number and street)where
all correspondence is to be sent. You may use your
ADOR 10196(1/18) Instructions Page 2
ARIZONA JOINT TAX APPLICATION (JT-1) INSTRUCTIONS
Section C: TRANSACTION PRIVILEGE TAX (TPT) is listed in an adjacent city, such as Scottsdale,
1. Provide the Date Business Started in Arizona. but the location of the business is actually within
the city of Phoenix. See "TPT Rate Look Up" on
2. Provide the Date Sales Began in Arizona or estimate www.AZTaxes.gov
when you plan to begin selling in Arizona. 4. Provide if your business is located on an Indian
3. Tax Liability: Provide the amount of gross income you Reservation; provide the Additional County/Region
can reasonably expect to generate in your first twelve Indian Reservation Code(s). A current listing is
months of business. You will be set up for monthly filing available at www.azdor.gov.
unless your Estimated Tax Liability will result in a tax Provide the Business Code(s) including all State and
liability of less than $8,000, which will require you to file City Business Code(s) that apply; based on your major
quarterly. business activity, principle product you manufacture,
4. Based on your tax liability, provide your filing frequency. commodity sold, or services performed. You must
If your total estimated annual combined Arizona, county indicate at least one business code. A current listing is
and municipal TPT liability is: available at www.azdor.gov.
• Less than $2,000, you may file and pay annually. If you have more locations, attach Additional Business
• Between $2,000 and $8,000, you may file and pay Locations form available at www.azdor.gov.
quarterly.
• Otherwise, your transaction privilege taxes are due Section E: WITHHOLDING & UNEMPLOYMENT TAX
monthly. APPLICANTS
If your business is Seasonal or you are a transient
vendor, indicate the months in which you intend to do 1. Provide the Date Employees First Hired in Arizona.
business in Arizona. 2. If you are liable for Federal Unemployment Tax, check
5. Indicate whether your business sells tobacco products. YES and enter the first year of liability.
If you checked yes, check the box to indicate if you are 3. If individuals in your business are performing services
a retailer or distributor of tobacco products. that are excluded from withholding or unemployment
6. TPT Filing Method: Check which filing method your tax, check YES and describe the services these
business uses for determining tax liability. Cash basis individuals are performing.
requires the payment of tax based on sales receipts 4. If your business has an IRS ruling that grants an
actually received during the period covered on the tax exclusion from Federal Unemployment Tax, check YES
return. When filing under the accrual basis the tax is and you must attach a copy of the Ruling Letter to this
calculated on the sales billed rather than actual receipts. application.
7. If you sell new Motor Vehicle Tires or Vehicles, 5. If you have,or previously had an Arizona unemployment
you must file the Motor Vehicle Waste Tire Fee form tax number,check YES and provider the business name
(TR-1) available at www.azdor.gov. Sellers of new you used and the unemployment number.
motor vehicles and motor vehicle tires in the state, for 6. Provide the first calendar quarter Arizona employees
on-road use, are required to report and pay a waste tire were or will be hired and paid.
fee to the Department of Revenue. 7. When do you anticipate or did you first pay a total of
8.through 9. Tax Records Physical Location indicate the $1,500 or more in gross wages in a calendar quarter'?
physical address where your tax records are located. Indicate the year and quarter in which this occurred or
Include the contact person's name and phone number. will occur.
8. When do you anticipate or did you first reach the 20th
Section D: TRANSACTION PRIVILEGE TAX(TPT) week of employing 1 or more individuals for a full or
PHYSICAL LOCATION partial day within the same calendar year? Indicate the
1. Provide the Business Name, "Doing Business As" year and quarter in which this occurred or will occur.
(DBA). DBA is the name of a business other than the
owner's name or, in the case of a corporation, a name Section F: ACQUIRED BUSINESS INFORMATION
that is different from the legal or true corporate name. If 1. Did you acquire or change all or part of an existing
it is the same as the Legal Business Name enter"same". business'? If part, to obtain an unemployment tax
2. Provide the Business Phone Number including the rate based on the business's previous account, you
area code. must request it no later than 180 days after the date of
3. Provide the Physical Location of the business. This acquisition or legal form of business change; contact
address cannot be a PO Box or Route Number. Provide: the Unemployment Tax Office Experience Rating Unit
• County/Region for an Application & Agreement for Severable Portion
• Residential Rentals ONLY - Number of Units Experience Rating Transfer (form UC-247; printable
• Reporting City, if different from the Physical Location version available online at www.azui.com).
city. For example, if the location for the listed address
ADOR 10196(1/18) Instructions Page 3
ARIZONA JOINT TAX APPLICATION (JT-1) INSTRUCTIONS
2. Provide the date you acquired the previous owner's • AA: TOTAL City License Fees — To calculate the
business or changed the legal form of your existing city fees, multiply No. of Locations in the city by the
business (sole proprietor to corporate, etc.). license fee and enter sum in Subtotal City License
3.through 6. Complete as indicated if you know the Fees. Then calculate and enter the sum of columns
previous owner's information. 1 + 2 + 3. If you have a location in Phoenix and the
7. through 9. If you merely changed the legal form of your business is only under Class 213, Commercial Lease,
existing business, indicate whether or not you changed there is no license fee due.
all or part of the business, the date of change and EIN • BB: TOTAL State License Fees — To calculate the
of previous Legal Form of Business. state fees, multiply the No. of locations in the state by
$12.
Section G: AZTAXES.GOV SECURITY ADMINISTRATOR • CC: TOTAL City Residential Rental License Fee —
USE THIS SECTION FOR CHANDLER, PHOENIX
Visit www.AZTaxes.gov (the Arizona Department of AND SCOTTSDALE ONLY. These cities WILL NOT
Revenue's online customer service center) to register for use the larger fee chart. To calculate Residential
online services. The authorized individual will have full Rental license fee, multiple the No. of units by the No.
online access to transaction privilege, use, withholding of locations by$2.00($50.00Annual Cap per license).
and corporate tax account information and services. The The amount for each city CANNOT EXCEED $50.00.
authorized individual will be able to add or delete users • DD: TOTAL DUE—Add lines AA+ BB + CC.
and grant user privileges. Online services include viewing Please send your payment for this amount. Failure to
tax account information, filing tax returns, signing returns include your payment with this application will result in a
electronically with a Self Select Personal Identification delay in processing your license. Licenses are not issued
Number(PIN) and remitting tax payments. until all fees have been paid.
Section H: REQUIRED SIGNATURES Make checks payable to the Arizona Department of
This application must be signed only by either a sole owner, Revenue. Be sure to return all pages of the application
at least two partners, managing member or corporate with your payment. Retain a copy of the application for
officer legally responsible for the business. This application your records.
CANNOT be signed by agents or representatives. • DO NOT SEND CASH
• Include your EIN or SSN on payment
Section I: STATE/COUNTY& CITY LICENSE FEE
WORKSHEET
There are no fees for Withholding/Unemployment
Insurance, or Use Tax registrations. State license fees
are calculated per business location. To calculate the city
license fees, use the listing of cities on page 4, Section I of
this application. City fees are subject to change. Check for
updates at www.azdor.gov.
ADOR 10196(1/18) Instructions Page 4
ARIZONA JOINT TAX APPLICATION (JT-1) INSTRUCTIONS
State/County Business Codes
Codes Taxable Activities Codes Taxable Activities Codes Taxable Activities
002 Mining-Nonmetal 014 Personal Property Rental 051 Jet Fuel Use Tax
004 Utilities 015 Contracting-Prime 053/055 Rental Car Surcharge
005 Communications 017 Retail 129 Use Tax Direct Payments
006 Transporting 019 Severance-Metalliferous Mining 153 Rental Car Surcharge-Stadium
007 Private (Rail)Car 023 Recreational Vehicle Surcharge 315 MRRA Amount
008 Pipeline 025 Transient Lodging 911 911 Telecommunications
009 Publication 029 Use Tax Purchases 912 E911 Prepaid Wireless
010 Job Printing 030 Use Tax from Inventory
011 Restaurants and Bars 033 Telecommunications Devices
012 Amusement 041 Municipal Water
013 Commercial Lease 049 Jet Fuel Tax
City Business Codes
Codes Taxable Activities Codes Taxable Activities Codes Taxable Activities
004 Utilities 020 Timbering&Other Extraction 116 Feed Wholesale
005 Communications 027 Manufactured Buildings 144 Hotel/Motel (additional tax)
Commercial Rental, Licensing
006 Transporting 029 Use Tax 213 for Use
Rental, Leasing and Licensing for
009 Publication 030 Use Tax from Inventory 214 Use of Tangible Personal Property
010 Job Printing 037 Contracting-Owner Builder 244 Lodging-Extended Stay
Commercial Lease(additional
011 Restaurants and Bars 040 Rental Occupancy 313 tax)
012 Amusement 044 Hotels 315 MRRAAmount
015 Contracting-Prime 045 Rental Residential
016 Contracting Spec Builder 049 Jet Fuel Tax
017 Retail 051 Jet Fuel Use
Retail Sales Food for Home
018 Advertising 062 Consumption
Severance-Metalliferous
019 Mining 111 Additional Restaurants& Bars
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