By Matthew Holloway |

A bill to exempt retirement savings from the state income tax is being considered by the Arizona House of Representatives.

SB 1371, sponsored by Sen. JD Mesnard (LD-13), would exempt all retirement investment savings, including 401Ks, IRAs, Roth IRAs, and pensions from state income tax for distributions made after an individual is 59 and a half years old.

As explained by the Arizona Senate Republicans in a post to X, the bill “works to reduce financial burdens on Arizonans who are over the age of 59.5 by exempting retirement income from taxation.”

The bill passed the Arizona Senate on March 6th along party lines.

In a press release from the Arizona Senate Republicans, Senator Mesnard stated, “Arizonans deserve to keep more of what they earn so they can plan for retirement at an appropriate age. This bill allows retirees to enjoy their responsible savings while securing a comfortable and stable life in their golden years, free from unnecessary financial burdens.”

He continued, “In a world where the cost of living continues to rise, we need to prioritize the needs of our citizens, making sure they have what they need to succeed. I remain committed to fostering a pro-growth, taxpayer-friendly environment for all Arizonans and look forward to seeing this legislation advance to the governor.”

The bill had its second reading in the Arizona House of Representatives on March 17th and is pending reports from the Rules and Appropriations committees.

Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.