Arkansas State Tax Calculator

Calculate your Arkansas state income tax and federal tax obligations. Arkansas uses a progressive tax system with rates ranging from 2% to 4.9%.

About Arkansas State Income Tax

Arkansas uses a progressive tax system with five tax brackets. The state has been reducing tax rates in recent years, with the top rate dropping from 6.9% to 4.9%.

Arkansas Tax Brackets 2026

  • $0 - $5,000: 2%
  • $5,001 - $10,000: 3%
  • $10,001 - $14,300: 3.4%
  • $14,301 - $24,300: 4.4%
  • Over $24,300: 4.9%

How Arkansas Tax is Calculated

Arkansas's progressive tax system works as follows:

  1. Income is divided into five tax brackets
  2. Each bracket is taxed at its corresponding rate
  3. Most taxpayers reach the top 4.9% rate
  4. Standard deduction reduces taxable income

Arkansas Tax Features

  • Low Top Rate: 4.9% is competitive with neighboring states
  • Recent Reductions: Rates have been cut significantly in recent years
  • Military Friendly: Military retirement pay exempt from state tax
  • Low Cost of Living: Combined with moderate taxes makes AR affordable

Frequently Asked Questions

What is Arkansas' income tax rate?

Arkansas has progressive tax rates from 2% to 4.9%. The top rate of 4.9% applies to income over $24,300, so most Arkansas taxpayers pay this rate on the majority of their income.

Does Arkansas tax retirement income?

Arkansas offers a retirement income tax credit. Taxpayers can exclude up to $6,000 of retirement income if their total income is below certain thresholds. Military retirement pay is completely exempt from Arkansas tax.

Does Arkansas tax Social Security?

No, Arkansas does not tax Social Security retirement benefits, making it relatively retirement-friendly.

How does Arkansas compare to neighboring states?

Arkansas (4.9%) is competitive: Missouri (4.95%), Oklahoma (4.75%), Tennessee (0%), Louisiana (4.25%), Mississippi (5%), and Texas (0%). Arkansas is middle-of-the-road among its neighbors.

Arkansas vs. Neighboring States

Tax comparison with surrounding states:

  • Tennessee: No state income tax
  • Texas: No state income tax
  • Oklahoma: Progressive up to 4.75%
  • Missouri: Progressive up to 4.95%
  • Louisiana: Progressive up to 4.25%
  • Mississippi: Progressive up to 5%

Tips for Arkansas Taxpayers

  • Take advantage of low top rate of 4.9%
  • Military retirees should claim full exemption
  • Claim retirement income credit if eligible
  • Arkansas doesn't tax Social Security - good for retirees
  • Consider Arkansas' low cost of living advantage