Arkansas income tax rates for 2025 and 2026

Arkansas has a 0% band and rates of 2%, 3%, 3.4% and a top rate, applied to net taxable income (after the standard or itemized deduction). The top rate was 3.9% for 2025. Act 1 of the 2026 First Extraordinary Session, approved May 6, 2026, cuts it to 3.7% for tax years beginning January 1, 2026; an identical Senate bill became Act 2 the same day. The Department of Finance and Administration (DFA) withholds at 3.7% in 2026.

The 0% band applies only to net income up to $94,700. Above that, the first $4,700 is taxed at 2% and the rest at the top rate, with a “bracket adjustment” easing the change for net income from $94,701 to about $97,600. The law indexes the tables to inflation each year, and in 2024 DFA raised that year’s statutory figures, so the final 2026 brackets could be a little higher than the amounts in the Act.

Arkansas does not start from federal adjusted gross income. The AR1000F return builds your income line by line, wages, interest, business income and so on, minus Arkansas’s own exemptions and adjustments, to reach Arkansas AGI. You then subtract the standard deduction, $2,470 for single filers, heads of household and each married person filing separately, or $4,940 for a joint return for 2025, or your itemized deductions, and look up the tax. Lower-income filers use low-income tax tables with the standard deduction built in.

After the tax, each taxpayer and spouse gets a $29 personal tax credit, plus $29 more for being 65 or older, blind or deaf, or filing as head of household or surviving spouse, and $29 for each dependent. People 65 or older who do not claim the retirement exemption get another $29, and filers with net income up to $27,600 can claim an additional low-income credit.

For example, a single filer with $60,000 of wages has $57,530 of net taxable income after the standard deduction. The tax is about $1,824 for 2025 at the 3.9% top rate, about $1,795 after the $29 credit; at 2026’s 3.7% rate it would be about $1,732.

The July 2025 federal tax law (Public Law 119-21) created deductions for 2025 through 2028 for qualified tips (up to $25,000), overtime pay (up to $12,500, or $25,000 joint), car loan interest (up to $10,000) and an extra $6,000 for people 65 or older. Arkansas builds its own income and adopts federal tax rules one section at a time, and its 2025 forms have no line for any of the four, so none of them lowers Arkansas tax; DFA treats tips as wages subject to Arkansas withholding. A 2025 bill to exempt overtime (HB1822) died in committee. Arkansas also does not follow federal bonus depreciation.

Using the retirement or military exemptions means you cannot use the low-income tax tables, though you can choose not to take the exemption if the tables give a lower tax.

Arkansas credits reduce tax but are not refundable. DFA’s earned income credit page describes only the federal credit; we found no Arkansas earned income credit on the return.

For 2025, a full-year resident files with gross income of at least $14,644 single, $20,821 head of household with one or no dependents or $24,696 married filing jointly with one or no dependents. Nonresidents with any Arkansas income must file, and so must part-year residents with any income while living in Arkansas. Residents file Form AR1000F; nonresidents and part-year residents file AR1000NR, which figures the tax as if you were a resident and charges the Arkansas share.

2025 returns were due April 15, 2026, and 2026 returns are due April 15, 2027. Arkansas honors an accepted federal extension and gives a month more than the federal one, usually to November 15; without one, file Form AR1055 by April 15. Tax is still due April 15, and DFA says inability to pay is not a reason for an extension.

Check an Arkansas refund with “Check My Refund Status” on DFA’s ATAP site, no login needed. It asks only for your Social Security number and the expected refund amount. For refund questions call (501) 682-1100 or (800) 882-9275, option 1.

DFA says a complete, accurate e-filed return gets its refund within 21 business days of acknowledgment, and a paper return takes up to 10 weeks. ATAP showing a return as received does not mean it has finished processing; DFA says it stopped more than $130 million in attempted fraudulent refunds in a year, so some returns get extra review.

A resident of Texarkana, Arkansas, whose permanent home is inside the city limits owes no Arkansas income tax, and a resident of Texarkana, Texas, owes none on pay for work in Texarkana, Arkansas; you must use a street address in the city, not a post office box or rural route. Outside Texarkana, Arkansas withholds from nonresidents for work done in Arkansas, and we found no reciprocal agreement with any state.

A nonresident who works remotely for an Arkansas employer is taxed only on income earned while physically in Arkansas, under Act 1019 of 2021. Arkansas residents who pay income tax to another state on the same income claim a credit, but not for Mississippi’s tax on gambling winnings.