Arkansas taxes

Personal and business state taxes in Arkansas for the 2025 tax year, filed in 2026.

Arkansas taxes personal income at rates up to 3.9%. A sole proprietor owes no separate business tax. Every Arkansas LLC pays a flat $150 franchise tax each year, and corporations pay a franchise tax based on their capital stock. C corporations also pay corporate income tax on a rising scale from 1% to 4.3%.

Personal income tax

Arkansas residents file Form AR1000F. Rates run up to 3.9%. Up to $100,000 of taxable income, you read the tax from Arkansas's printed tax table, which moves in $100 steps. Above $100,000, the tax is $3,809 plus 3.9% of the amount over $100,000.

Arkansas gives personal credits against the tax rather than exemptions from income: $29 for you, your spouse and each dependent, with extra credits for being 65 or older, blind, deaf, or a head of household. Social Security is not taxed, but unemployment compensation is.

Between $94,701 and $97,801 of taxable income, Arkansas phases out a rate adjustment, so each extra dollar in that stretch costs more tax than usual.

Return
Form AR1000F
Rates
0% below $5,600, 2% from $5,600, 3% from $11,200, 3.4% from $16,000, 3.9% from $26,400
Above the table
$3,809 plus 3.9% of taxable income over $100,000
Standard deduction
$2,470 for each filer, so $4,940 on a joint return
Personal credits
$29 each for you and your spouse, plus one more for each of: 65 or older, blind, deaf, head of household
Dependent credit
$29 per dependent
Retirement plans
The first $6,000 of employer retirement plan distributions is exempt for each person
Not taxed
Social Security
Taxed
Unemployment compensation

Sole proprietor

A sole proprietor with no LLC owes Arkansas nothing at the business level. The franchise tax is charged to registered entities only, so there is no report to file.

Your business profit is taxed on your own Form AR1000F, at the personal rates above. Forming an LLC would start the $150 a year.

Single-member LLC

Every Arkansas LLC files the Annual LLC Franchise Tax Report and pays a flat $150 franchise tax by May 1, however few members it has. It is charged for being registered in Arkansas, not on profit, so it is owed whatever the business earned.

It goes to the Secretary of State, not the Department of Finance and Administration. Filing late adds a $25 penalty plus interest. The LLC's profit is taxed on your own Form AR1000F.

Partnership

An Arkansas partnership files Form AR1050, the partnership return. The profit passes through to the partners, who report it on their own returns.

A partnership set up as an LLC also pays the flat $150 franchise tax to the Secretary of State by May 1, whatever it earned. Filing late adds a $25 penalty plus interest.

Arkansas makes a pass-through business withhold Arkansas tax for owners who live elsewhere, or include them in a composite return. A nonresident owner can opt out of withholding by filing an affidavit, Form AR4PT. The amount is not worked out here, because it needs each owner's residence and share.

S corporation

An Arkansas S corporation files Form AR1100S. The profit passes through to the shareholders, who report it on their own returns.

It also files the Annual Corporation Franchise Tax Report and pays franchise tax to the Secretary of State by May 1, even in a year it lost money. A corporation with stock pays an amount based on its outstanding capital stock. A corporation without authorized stock pays a flat $300.

Arkansas makes a pass-through business withhold Arkansas tax for owners who live elsewhere, or include them in a composite return. A nonresident owner can opt out of withholding by filing an affidavit, Form AR4PT. The amount is not worked out here, because it needs each owner's residence and share.

C corporation

A C corporation files Form AR1100CT and pays corporate income tax on a rising scale: 1% of the first $3,000, 2% of the next $3,000, 3% of the next $5,000, 4.3% of everything above $11,000. Each slice is taxed at its own rate, so a small profit is not taxed at 4.3%.

A corporation selling into other states counts only its Arkansas share, measured by Arkansas sales over total sales. From 2025, a sale of services or intangibles counts where the customer receives it.

It also pays the franchise tax on its capital stock by May 1, on the Annual Corporation Franchise Tax Report, even in a year it lost money. A corporation without authorized stock pays a flat $300.

Return
Form AR1100CT
Corporate income tax
1% of the first $3,000, 2% of the next $3,000, 3% of the next $5,000, 4.3% of everything above $11,000
Above the top step
$240 plus 4.3% of income over $11,000
Multi-state profit
Arkansas sales over total sales
Franchise tax
Based on outstanding capital stock, due May 1

Estimate your state tax

Pick your business type and enter this year's numbers to see the state business tax Arkansas charges. It assumes all your sales are in Arkansas.

An estimate for planning, not tax advice.

Sources

Last reviewed August 2026.

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