Arkansas

Sales Tax

  • Statewide: 6.5%
  • Counties can levy sales tax of no more than 6.125%.
  • Current average sales tax (with local taxes included): 9.2%
  • Common Exceptions at State Level:
    • Prescription Medicine: Exempt
    • Unprepared Foods: .125%
  • Gasoline Tax: 43.40 cents/gallon (Includes all state, local, and federal taxes)
  • Diesel Fuel Tax: 53.20 cents/gallon (Includes all state, local, and federal taxes)

Personal Income Tax

  • Personal Income Tax Rate Range: State has two tax brackets. Those making over $95,501 pay 3.9%; those making less than $92,301 pay between 0% and 3.9%. Tax for those making between $92,301 and $95,900 are taxed with a different formula. Same for married filing jointly. 
  • Standard deduction: Single Filing Status: $2,410
  • 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 
    • VA Disability Dependency & Indemnity Compensation Benefits: Exempt
    • SBP/SSBP/RCSBP/RSFPP: Exempt

*Up to $6,000 of retirement income may be tax-exempt for those age 59 1/2 or older.

Income Tax Comments: State allows county- and city-level income tax.

Property Tax

  • Local municipalities average .57% 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 $500
    • 65 and Over or Disabled: Assessed value frozen until sold or improvements made.
    • Disabled Veteran/Surviving Spouse/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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