Question 1

What is Arkansas's state income tax rate for 2025?

Accepted Answer

Arkansas uses a progressive 5-bracket structure with a top rate of 3.9%, reduced from 4.4% by Act 1 of the 2nd Extraordinary Session of 2024. For tax year 2025, the brackets are: 0% on $0-$5,599; 2% on $5,600-$11,199; 3% on $11,200-$15,999; 3.4% on $16,000-$26,399; and 3.9% on income above $26,400. Rates and thresholds are inflation-indexed annually under A.C.A. Section 26-51-201.

Question 2

Does Arkansas use the same brackets for all filing statuses?

Accepted Answer

Yes. Unlike most states, Arkansas applies the same bracket thresholds to single, married-filing-jointly, married-filing-separately, and head-of-household filers under A.C.A. Section 26-51-201. Joint filers do not receive doubled bracket widths, so two-earner married couples may see a marginal marriage penalty at higher income levels compared to states that double bracket widths for MFJ.

Question 3

What is Arkansas's standard deduction for 2025?

Accepted Answer

For tax year 2025, Arkansas's standard deduction is $2,410 for single filers and $4,820 for married-filing-jointly filers, both inflation-indexed. Arkansas also offers a per-person tax credit ($29 per taxpayer and per dependent for 2025) rather than a personal exemption deduction, which benefits lower-income filers proportionately more than a higher-income taxpayer with the same family size.

Question 4

Does Arkansas tax retirement income?

Accepted Answer

Arkansas exempts the first $6,000 of qualified retirement plan distributions (including IRAs, 401(k)s, 403(b)s, defined-benefit pensions, and public retirement plan distributions) per taxpayer, regardless of age. Military retirement pay is 100% exempt without cap under Act 141 of 2017. Social Security benefits are fully exempt from Arkansas state income tax.

Question 5

When is Arkansas's state income tax filing deadline?

Accepted Answer

Arkansas conforms to the federal filing deadline of April 15, or the next business day when April 15 falls on a weekend or holiday. An automatic 6-month extension to October 15 is available by filing Form AR1055, but any state tax owed must still be paid by April 15 to avoid interest and penalties. Electronic filing is available through the Arkansas Taxpayer Access Point (ATAP).

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