Arkansas

Sales Tax

  • Statewide: 6.5%
  • Counties can levy sales tax of no more than 5%.
  • Current average sales tax (with local taxes included): 8.629%
  • Common Exceptions at State Level:
    • Prescription Medicine: Exempt
    • Unprepared Foods: 2%
  • Gasoline Tax: 43.20 cents/gallon (Includes all state, local, and federal taxes)
  • Diesel Fuel Tax: 53.20 cents/gallon (Includes all state, local, and federal taxes)
  • Cigarette Tax: $1.15/pack of 20

 

Personal Income Tax

  • Personal Income Tax Rate Range: 12 brackets from 0% to 5.9%.
  • Standard deduction: Single Filing Status: $2,200/Married Filing Jointly: $4,400.
  • Personal Exemption Allowance: $29/Dependent Exemption: $29. (Both taken as tax credit)
  • Itemized Deductions Allowed?: Yes. Subject to limitations.
  • Retirement Income
    • Social Security: Exempt
    • IRAs: Taxable at ordinary income tax rates.*
    • 401Ks/Defined contribution employer retirement plans: Taxable at ordinary income tax rates.*
    • Private pensions: Taxable at ordinary income tax rates.*
    • Public Pensions: Taxable at ordinary income tax rates.*
  • Military Pay
    • Active Duty Pay: Exempt
    • Military Retirement Pay: Exempt
    • Military Disability Pay: Exempt to the extent excluded from Federal Adjusted Gross Income
    • VA Disability Dependency & Indemnity Compensation Benefits: Exempt
    • SBP/SSBP/RCSBP/RSFPP: Exempt

Income Tax Comments: *Up to $6,000 of retirement income may be tax-exempt. State allows county- and city-level income tax.

 

Property Tax

  • Local municipalities average .62% of the property's assessed value.
  • Calculation of assessed value: 20% of fair market value; cannot increase more than 5% per year for most properties.
  • State-Level Relief programs for:
    • Owner-occupied: May be eligible for credit of up to $375
    • 65 and over or Disabled: Assessed value frozen
    • Disabled Veteran/Surviving Spouse (not remarried) & dependent children: Full tax exemption if meet certain requirements.
  • Personal Property Tax: Yes. Rates and exemptions vary.

 

Inheritance & Estate Taxes: None

 

Department of Revenue website: www.dfa.arkansas.gov

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