Lawyers for the state are attempting to appeal a ruling from a federal judge that said Arizona families had to declare family rebate funds on their tax returns.
In 2023, the state had a budget surplus and provided a rebate to Arizona families, which amounted to $250 per child.
Lawyers for the Arizona Attorney General’s Office contend the IRS was wrong when it collected over $20 million in taxes from the program last year.
A federal judge ruled that only families who had been harmed from the tax collection could bring a suit, not the state.
The AG’s office argues it lost out on sales tax revenue as families could not spend that rebate money in the state.
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