Arkansas has a progressive state income tax with rates ranging from 2% to 4.4%. The state has been steadily reducing its top rate in recent years, making it more competitive with neighboring states.
Arkansas Tax Brackets (2026)
| Taxable Income | Tax Rate |
|---|---|
| $0 - $5,100 | 2.0% |
| $5,100 - $10,200 | 4.0% |
| $10,200+ | 4.4% |
Arkansas has been gradually reducing its top rate. It was 5.5% in 2021 and is scheduled to continue decreasing. These figures are based on Arkansas Department of Finance and Administration guidelines.
What You'll See on Your Paystub
An Arkansas worker's paystub includes both federal income tax withholding and state deductions:
| Deduction | Rate | Notes |
|---|---|---|
| Federal Income Tax | Varies | Based on W-4 and income |
| Social Security | 6.2% | Up to $181,200 wage base |
| Medicare | 1.45% | No wage limit |
| Arkansas State Income Tax | 2.0% - 4.4% | Based on income level |
Arkansas Standard Deduction
Arkansas offers a standard deduction that reduces your taxable income:
| Filing Status | Standard Deduction (2026) |
|---|---|
| Single | $2,340 |
| Married Filing Jointly | $4,680 |
| Head of Household | $2,340 |
Arkansas also offers a personal tax credit of $29 per exemption, which directly reduces your tax liability.
No Local Income Taxes
Arkansas does not allow cities or counties to impose local income taxes. Your state withholding covers all Arkansas income tax obligations.
Low-Income Tax Credit
Arkansas provides a Low-Income Tax Credit for qualifying taxpayers:
- Available to single filers with income under $23,600
- Available to joint filers with income under $39,700
- Credit phases out as income increases
- Can significantly reduce or eliminate state tax liability
Retirement Income
Arkansas offers tax benefits for retirees:
- Social Security benefits are fully exempt
- Up to $6,000 exemption for retirement income (per person)
- Military retirement pay is fully exempt
- State and federal pension income qualifies for exemption
Arkansas's retirement income exemption applies to each spouse individually, so a married couple can exempt up to $12,000.
Arkansas vs. Neighboring States
| State | Tax Structure | Top Rate |
|---|---|---|
| Arkansas | Progressive | 4.4% |
| Texas | None | 0% |
| Oklahoma | Progressive | 4.75% |
| Missouri | Progressive | 4.8% |
| Tennessee | None | 0% |
| Louisiana | Progressive | 4.25% |
Comparing Take-Home Pay
Here's how a $75,000 annual salary in Arkansas compares to other states:
| State | Effective Rate | Annual State Tax |
|---|---|---|
| Arkansas | ~4.0% | ~$2,850 |
| Texas | 0% | $0 |
| Oklahoma | ~4.3% | ~$2,900 |