A.R.S. § 42-1255: Burden of proof

The department has the burden of proof by a preponderance of the evidence in any administrative or judicial proceeding regarding any factual issue that is relevant to ascertaining the tax liability of a taxpayer. This section does not abrogate any provision of this title or title 43 that requires a taxpayer to substantiate an item of income or expense. This section applies to a factual issue if a preponderance of the evidence demonstrates that:

1. The taxpayer asserts a reasonable dispute regarding the issue.

2. The taxpayer has fully cooperated with the department regarding the issue including providing, within a reasonable period of time, access to and inspection of all witnesses, information and documents within the taxpayer's control, as reasonably requested by the department.

3. The taxpayer has kept and maintained records as required by this title, by title 43 or by the department.