income tax; credit; savings plans

HB 2418 creates a new income tax credit for Arizona taxpayers who contribute to 529 college savings plans. It allows a credit equal to contributions (up to $5,000 per beneficiary annually) for tax years starting in 2026, with annual inflation adjustments based on the Phoenix consumer price index. Unused credit amounts can be carried forward for up to five years to offset future tax liability. This directly affects Arizona residents saving for higher education expenses through qualifying 529 plans, excluding contributions already claimed as a separate deduction under section 43-1022.