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Arkansas State Income Tax: Rates and Who Pays in 2023-2024

With a population of about three million people, Arkansas is considered a mid-size state. People living in the state enjoy a relatively low tax system, especially on income and property. This guide will resolve all your queries about Arkansas State Income taxes to help you stay ahead in your tax filing management.
Arkansas State Income Tax (2)
Arkansas State Income Tax: Rates and Who Pays in 2023-2024
Providing residents with a more affordable and attractive living environment is Arkansas' top priority. Here's a comprehensive guide to help you better understand Arkansas State Income Tax, ensuring you stay strong in your tax filing game every financial year.
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Providing residents with a more affordable and attractive living environment is Arkansas’ top priority. With a population of about three million people, Arkansas is considered a mid-size state. People living in the state enjoy a relatively low tax system, especially on income and property.

Besides, Arkansas does not tax Social Security, and its property taxes are among the lowest in the U.S. However, sales taxes in the state remain high for the residents. Furthermore, Arkansas offers various benefits on retirement taxes. Retirees aged 59.5 or older can be exempt from the first $6,000 of an IRA distribution. Here’s a comprehensive guide to help you better understand Arkansas State Income Tax, ensuring you stay strong in your tax filing game every financial year. Check out Beem to file your federal and state taxes online. Use Beem Tax Calculator to get a quick and accurate estimate of your federal and state tax refund for free.

Does Arkansas have State income tax?

An individual taxpayer who files an Arkansas full-year resident income tax return could receive a one-time inflationary relief income-tax credit under Act 1 of the Third Extraordinary Session of the 93rd General Assembly. Taxpayers with a total income up to $101,000 can receive an income tax credit of $10 to $150 in 2022. If filing jointly receives an income tax credit between $20-$300 in 2022, they can get the credit according to their net income for 2022.

Arkansas State Income Tax – How much will the income after tax in Arkansas with Filing Status

Annual IncomeFiling Status –
Single
Filing Status –
Married Filing Jointly
Filing Status –
Head of Household
$12000$11,675$11,782$11,782
$15000$14,305$14,631$14,631
$20000$18,530$19,356$19,296
$22000$20,220$21,246$20,986
$30000$26,844$28,396$27,746
$35000$30,969$32,621$31,952
$36000$31,794$33,466$32,777
$42000$36,744$38,536$37,727
$45000$39,219$41,071$40,202
$48000$41,694$43,575$42,677
$52000$44,994$46,875$45,977
$54000$48,167$50,175$49,277
$60000$51,067$53,475$52,577
$62000$52,517$55,125$54,227
$65000$54,692$57,600$56,702
$70000$58,317$61,725$60,827
$75000$61,942$65,850$64,952
$80000$65,567$69,975$68,607
$85000$69,192$74,100$72,232
$90000$72,817$78,225$75,857
$92000$74,267$79,875$77,307
$95000$76,442$82,350$79,482
$114000$89,977$97,570$93,146
$115000$90,682$98,295$93,851
$140000$108,307$116,420$111,476
$150000$115,357$123,670$118,526
$160000$122,407$130,920$125,576
$165000$125,932$134,545$129,101
$190000$142,997$152,670$146,681
$185000$139,872$149,045$143,201
$260000$185,814$202,301$189,692
$300000$209,614$230,501$213,492
$350000$239,364$265,751$243,242
$120000$94,207$101,920$97,376
$135000$104,782$112,795$107,951
$170000$129,457$138,170$132,626
$180000$136,507$145,420$139,676
$250000$179,864$195,251$183,742
$28000$25,194$26,706$26,056
$32000$28,494$30,086$29,436
$40000$35,094$36,846$36,077
$44000$38,394$40,226$39,377
$53000$45,819$47,700$46,802
$56000$48,167$50,175$49,277
$58000$49,617$51,825$50,927

Arkansas State Income Tax Rates and Tax Brackets

Tax rates in Arkansas for 2014 varied from 4% to 7%. In the last decade, however, the personal income tax rate in Arkansas has consistently fallen. With the 2022 tax year, Arkansas’ tax rates will drop to 4.9%, a record low. Moreover, their net income will be considered when computing how much tax they will pay.

Arkansas State Income Tax Rate for Individuals in 2023

Net IncomeTax PercentageMinus Adjustment
$0 – $5,0990%$0
$5,100 – $10,2992%$101.98
$10,300 – $14,6993%$204.97
$14,700 – $24,2993.40%$263.77
$24,300 – $87,0004.90%$628.25

Rates of income tax for individuals with net incomes less than $84,500

$0 – $5,0990.00%
$5,100 – $10,2992%
$10,300 – $14,6993%
$14,700 – $24,2993%
$24,300 – $87,0004.70%

A 39.6% income tax rate applies to individuals with incomes over $84,500

$0 – $4,4002.00%
$4,401 – $8,8004%
$8,801+5%

What is Arkansas Standard Dseduction?

Standard Deduction: Deductions of $4,400 can be claimed while filing taxes together, and $2,200 are available to individuals filing individually.

Itemized Deductions: An itemized deduction can be either a standard deduction or a standard deduction for tax deductions. Since the standard deduction does not cover your expenses, it’s best to itemize your deductions. Each spouse must itemize on their separate tax returns if they are married.

Arkansas State Income Tax Credits

Itemized deductions are allowed in Arkansas in the following amounts:

Child and Dependent Credit

The child and dependent care credit is available to taxpayers who pay someone to look after their children, disabled spouse, or disabled dependent while they work (or look for work). Marriage requires both spouses to have worked unless one is disabled or enrolled in full-time school. A federal tax credit of 20% can be claimed on your state tax return using Federal Form 2441.

Adoption Tax Credit

Taxpayers who paid adoption expenses may claim an adoption expense credit. The federal credit is calculated using Form 8839, and you can claim 20% of the credit on your state tax return.

Political Contributions Credit

Contributions to a candidate, campaign committee, political action committee, or political party may qualify for a tax credit of up to $50 ($100 for married filers filing joint returns). Contributions are not allowed for federal candidates in Arkansas. Contributions must be received by April 15.

How to Calculate Arkansas State Income Tax

In Arkansas, residents must pay $11,683 in taxes on $70,000 in income. Considering your marginal tax rate for the tax year is 22%, you will be paying an average tax rate of 11.67%. Any additional income you receive right away will be subject to a marginal tax rate of this magnitude. The standard deduction may not apply to you if your income in 2022-2023 falls below the threshold and you are blind.

Do I have to Pay Arkansas State Income Tax?

Arkansas state income tax may or may not apply depending on your circumstances. Non-residents and residents of Arkansas earning income within its borders and from various sources are also subject to income taxes. Consider these factors:

Residency

There is no distinction between income earned within and income earned outside Arkansas in terms of whether or not state income tax is being paid by the state, regardless of whether or not it is earned within or outside of the state. It is essential to consider factors such as your permanent residence and where you live when determining your domicile.

Even if you are not an Arkansas resident, you may be liable for Arkansas state income tax (for example, from employment, rental income, or business activities).

Domicile

Arkansas may deem you a domiciliary if you own a permanent residence in the state.

Tax Treaties

Tax treaties between your country and the United States may affect your tax liability in Arkansas if you’re a non-resident.

Exemptions and Credits

There may be exemptions and credits available in Arkansas that can reduce the amount of taxes you owe. For instance, you can deduct mortgage interest and dependents from your taxable income.

Filing Requirements

Although you do not owe any Arkansas state income taxes, you may still have to file an Arkansas state tax return if you earn income and wish to take advantage of any applicable exemptions or credits.

If you need assistance determining your specific tax liability based on your circumstances, please consult the Arkansas Department of Finance and Administration or an experienced tax professional. To comply with the tax laws, it’s essential to stay up-to-date with the most current information since state tax laws can be complicated and change over time.

Arkansas State Income Tax (2)
Arkansas State Income Tax: Rates and Who Pays in 2023-2024 2

How to Pay Arkansas State Income Tax

The first thing you need to do is figure out your state’s income tax filing status before you begin paying your taxes. It is possible to choose between several different filing statuses, including single, married, married filing jointly, married filing separately, and head of household, among others. The filing status of your tax return is essential to determining your tax rate and deductions, as well as how to file your tax return.

Calculate Your Tax Liability

Use the appropriate tax forms and instructions to calculate your Arkansas state income tax liability. A tax professional or tax preparation software can help you with these calculations if you need help to do them manually.

Gather All Documents

Make sure you have all the necessary financial documents, such as your W-2s, 1099s, and other income-related records, for preparing your income tax return.

File Your Return

If you are an Arkansas taxpayer and you owe state income tax, you must file your return as follows:

  • Online: Taxpayers in Arkansas can file online through the Arkansas Department of Finance and Administration’s Arkansas Taxpayer Access Point (ATAP). You may need to create an ATAP account.
  • Paper Form: Complete the necessary forms and mail them to the address provided on the form if you prefer to file a paper return.
  • Tax Software or Tax Professional: Additionally, you can use tax preparation software or hire a qualified tax accountant to file your state income tax return.

Make Your Payment

  • Online Payment: Electronic payments can be made through the Arkansas Taxpayer Access Point (ATAP). Credit cards or bank accounts can be used to make payments.
  • Check or Money Order: In the memo line, identify “2023 Income Tax” and your Social Security Number if you prefer to make the payment by check or money order. If you are sending your payment and return, the address is provided on the tax form.
  • Electronic Funds Transfer (EFT): EFT can be used to pay tax liabilities by businesses or individuals with significant liabilities. The Arkansas Department of Finance and Administration can provide you with more information.

Am I A Resident for Arkansas Income Tax Purposes?

There was a residence or domicile in Arkansas for an Arkansas Resident during the past calendar year. As soon as possible, please complete Form AR-1000S or Form AR-1000F. The term Arkansas non-resident refers to people living outside Arkansas who earn income from Arkansas-based sources, even if they do not reside in Arkansas. A copy of your federal tax return must be attached to your Arkansas return for it to be processed. All fields on the form AR-1000NR must be filled out. 

Some events can occur during the tax year that results in someone being considered an Arkansas Part-Year Resident. Your Arkansas return may only be processed if you attach a copy of your Federal return. The form AR-1000NR must be completed in its entirety.

Full-Year Residents

Those who meet the following criteria and are a full-year resident are required to file an Arkansas tax return:

Part-Year Residents

No matter what their filing status may be, non-residents and part-year residents must file a tax return if they received gross income from Arkansas sources. People who move into or out of Arkansas during a tax year are considered Arkansas Part-Year Residents. Your Arkansas return may only be processed if you attach your Federal return. AR1000NR should be filled out completely.

Non-resident Status Rules

Although non-residents of Arkansas are not domiciled, they receive income from Arkansas sources. You may only be able to process your Arkansas return if you attach your Federal return. Complete AR1000NR as thoroughly as possible. 

Resident Status Rules

During the past calendar year, an Arkansas Resident lived in or maintained a domicile in Arkansas. Fill out the AR-1000S or AR1000F form. 

Filing StatusYou must file if your income is at least:
Single$13,055
Household head (with or without dependents)Families with at least two dependents$18,561$22,126
Joint Filing for Married Couples (with or without dependents)Joint filing by a married couple with two or more dependentsFiling Separately for Married Couples$22,016$26,497$8,500
One dependent widow(er) who qualifiesHaving two or more dependents qualifies a widow(er) as a qualifying widow(er)$18,561$22,126

Where is My Arkansas State Income Tax Refund?

When you access the ATAP website at www.atap.arkansas.gov, it allows you to check your refund status and make payments daily. The site may indicate that your return has not been processed if it says your refund can’t be found.

Why Did My Arkansas State Income Tax Increase?

As part of the Arkansas tax bill signed by Gov. Sarah Huckabee Sanders, corporations and individuals will see their taxes reduced and receive a temporary non-refundable tax credit. A second rate reduction has been approved by Arkansas lawmakers this year. As a result of a general revenue surplus of $1.161 billion for fiscal year 2023, the state was able to provide this tax relief.

Arkansas Sales Tax

In Arkansas, the state sales tax rate is 6.5%. There’s a destination-based sales tax system in Arkansas, therefore, it is crucial to pay attention to the different tax rates across the state. Tax rates can significantly vary depending on the location of your customers, as well as the levels of sales tax applicable in the specific locations. Use Beem to file your income taxes online and get every dollar you’re due.

Five Things to Know About Arkansas Income Tax

  1. You must file your Arkansas state income tax return by the state’s income tax filing deadline. Ensure to make any payments required by the state at the same time. It is the responsibility of most taxpayers to file their taxes by April 15, but this can vary from year to year. So, it is essential to check the deadline for the current year before filing your taxes.
  2. To maintain records, keep copies of all documents related to your tax return. To prepare for an audit, it is vital to keep records for at least three years after the audit events.
  3. The Arkansas Department of Finance and Administration website or a tax professional is an excellent place to find the latest information on filing and paying Arkansas state income tax.
  4. The state collects an average of $929 in property taxes in Benton County. The lowest is in Calhoun County at $275. Property taxes in the state average $532 per year.
  5. Arkansas has a lower standard deduction than the federal standard deduction. It is estimated that most filers will be able to claim a deduction of $2,200. In the case of married filers, the amount is doubled to $4,400 because they are filing jointly.

Frequently Asked Questions

Q. Arkansas a high-tax state?

Arkansas is not considered a high-tax state.

Q. Is Arkansas a tax-friendly state?

Arkansas is generally considered a tax-friendly state.

Q. Is Arkansas a good place to live for taxes?

Arkansas can be a good place to live for taxes due to its friendly tax policies.

Q. How much of my paycheck goes to taxes in Arkansas?

The amount of your paycheck going to taxes in Arkansas depends on your income and deductions.

Q. Is Arkansas tax income earned in another state?

Arkansas may tax income earned in another state, but it provides a credit for taxes paid to another state.

Q. Does the state of Arkansas tax social security income?

The state of Arkansas does not tax Social Security income.

Q. Can Arkansas state income tax go up?

Arkansas state income tax rates can change but require legislative approval.

Q. Do seniors have to pay state income tax in Arkansas?

Seniors in Arkansas are generally exempt from state income tax on Social Security and pension income up to a specific limit.

Q. Does Arkansas have state income tax for the military?

Arkansas offers unique tax benefits for military personnel, such as exemptions for active-duty pay.

Q. What are Arkansas’s state income taxes for LLCs?

Arkansas taxes LLCs at the entity level with a tax rate of 6.5% as of my last update, but tax laws may have changed since then.

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This page is purely informational. Beem does not provide financial, legal or accounting advice. This article has been prepared for informational purposes only. It is not intended to provide financial, legal or accounting advice and should not be relied on for the same. Please consult your own financial, legal and accounting advisors before engaging in any transactions.

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