Title 26, Taxation

(a) (1) Subject to the limitation stated in subdivision (a)(2) of this section, there is allowed an income tax credit against the income tax imposed by this chapter in an amount equal to fifty percent (50%) of an eligible taxpayer's railroad track maintenance expenditures.(2) The…

(a) The Department of Finance and Administration may adopt rules to implement and administer this subchapter and to enable the certification of the income tax credit amount earned by each eligible taxpayer. (b) The Department of Commerce shall adopt rules to:(1) Permit verificati…

This subchapter shall be known and may be cited as the “Sustainable Aviation Fuel Incentive Act”.

(1) As used in this subchapter:(1) “Incentive agreement” means an agreement entered into by a business and the Arkansas Economic Development Commission to provide the business an incentive to locate a new qualified sustainable aviation fuel project in the state;(2) (A) “New full-…

(a) (1) There is allowed an income tax credit against the income tax imposed by this chapter in an amount equal to thirty percent (30%) of the cost of sustainable aviation fuel production and processing equipment purchased for use in the state by a qualified manufacturer of susta…

The Secretary of the Department of Finance and Administration, the Secretary of the Department of Commerce, and the Secretary of the Department of Energy and Environment may promulgate rules to implement and administer this subchapter.

(a) As used in this section:(1) “Head of household” means the same as defined in 26 U.S.C. § 2(b), as in effect on January 1, 2011; and(2) “Surviving spouse” means the same as defined in 26 U.S.C. § 2(a), as in effect on January 1, 2011. (1) “Head of household” means the same as …

(a) The following organizations shall be exempt from taxation under the Income Tax Act of 1929, § 26-51-101 et seq.:(1) Fraternal benefit societies, orders, or associations:(A) Operating under the lodge system or for the exclusive benefit of the members of a fraternity itself ope…

Income derived from investments made by nonprofit organizations, whether or not the organization is organized or exists under the laws of this state, shall be exempt from state income tax where the income is for the sole purpose of providing pension and annuity benefits to member…

(a) (1) (A) For tax years beginning before January 1, 2007, no member of the armed services of the United States shall be liable for or required to pay any income tax on the first six thousand dollars ($6,000) of service pay or allowances.(B) (i) For tax years 2005 and 2006, enli…

(a) (1) The first six thousand dollars ($6,000) of benefits received by a resident of this state from an individual retirement account or the first six thousand dollars ($6,000) of retirement benefits received by a resident of this state from public or private employment-related …

An organization or trust described in 26 U.S.C. § 401(a), as in effect on January 1, 2009, is exempt from income taxation under the Income Tax Act of 1929, § 26-51-101 et seq.

(a) Title 26 U.S.C. § 664, as in effect on January 1, 2017, and the regulations of the United States Secretary of the Treasury promulgated under 26 U.S.C. § 664 and in effect on January 1, 2017, are adopted for the purpose of computing the tax liability of charitable remainder tr…

Title 26 U.S.C. §§ 911 and 912, as in effect on January 1, 2007, 26 U.S.C. § 911 regarding citizens or residents of the United States living abroad, and 26 U.S.C. § 912 regarding certain allowances for citizens or residents of the United States living abroad, are adopted for the …

(a) A qualified windmill blade manufacturer that meets the criteria found in subsection (b) of this section is exempt from income taxes levied under the Income Tax Act of 1929, § 26-51-101 et seq., until December 31, 2033. (b) A windmill blade manufacturer shall meet the followin…

(a) A qualified windmill blade or windmill component manufacturer that meets the criteria under this section is eligible for a limited exemption from the income taxes levied under the Income Tax Act of 1929, § 26-51-101 et seq. (b) To qualify for a limited exemption under this se…

(a) There is allowed an exemption from the income tax imposed by the Income Tax Act of 1929, § 26-51-101 et seq., for the period of time determined under subsection (b) of this section for a qualified drop-in biofuels manufacturer. (b) The number of years that an income tax exemp…

(a) As used in this section, “agricultural disaster program” means a program that provides compensation to a cattle farmer or cattle rancher who has suffered a loss as the result of an emergency, a disaster, or declining market prices or value, including without limitation the fo…

There is allowed an exemption from the income tax imposed by the Income Tax Act of 1929, § 26-51-101 et seq., for a community match income incentive received by a taxpayer under the Community Match Rural Physician Recruitment Program, §§ 6-81-701 — 6-81-722.

(a) There is allowed an exemption from the income tax imposed under this chapter for:(1) Payments made to a taxpayer by the United States Department of Agriculture under the Market Facilitation Program authorized by 15 U.S.C. § 714c, as it existed on January 1, 2020;(2) Recovery …

(a) A taxpayer must calculate his or her Arkansas income tax liability using the same accounting method for Arkansas income tax purposes as used for federal income tax purposes. (b) A taxpayer must provide to the Secretary of the Department of Finance and Administration a copy of…

(a) A taxpayer must calculate his or her Arkansas income tax liability using the same income year for Arkansas income tax purposes as used for federal income tax purposes. (b) A taxpayer must provide to the Secretary of the Department of Finance and Administration a copy of any c…

(a) The term “net income” means the adjusted gross income of a taxpayer less the deductions allowed by the Income Tax Act of 1929, § 26-51-101 et seq. (b) “Adjusted gross income” means, in the case of an individual, gross income minus the following deductions:(1) Trade and busine…

(a) (1) “Gross income” includes:(A) Gains, profits, and income derived from salaries, wages, or compensation for personal service of whatever kind and in whatever form paid;(B) Gains, profits, and income derived from professions, vocations, trades, business, commerce, or sales;(C…

(a) An individual carrying on business as a partner in a partnership shall be liable for income tax only in his or her individual capacity and shall include in his or her gross income the distributive share of the net income or net loss of the partnership received by him or her o…

(a) Every individual, taxable under the Income Tax Act of 1929, § 26-51-101 et seq., who is a beneficiary of an estate or trust shall include in his or her gross income the distributive share of the income or loss of the estate or trust received by him or her or distributable to …

(a) A financial institution having its principal office in this state shall be taxed as a business corporation organized and existing under the laws of this state. (b) (1) A financial institution having its principal office outside this state but doing business in this state shal…

Dividends paid on shares of stock of financial institutions shall be subject to income tax under the Income Tax Act of 1929, § 26-51-101 et seq., on the same basis as dividends on shares of stock of business corporations.

(a) Subchapter S of the Internal Revenue Code, 26 U.S.C. § 1361 et seq., as in effect on January 1, 2019, regarding small business corporations, is adopted for the purpose of computing Arkansas income tax liability. (b) (1) (A) A corporation shall be treated as a Subchapter S cor…

Whenever, in the opinion of the Secretary of the Department of Finance and Administration, the use of inventories is necessary in order to clearly determine the income of any taxpayer, inventories shall be taken by the taxpayer, upon such basis as the secretary may prescribe, con…

(a) For the purpose of ascertaining the gain or loss from the sale or other disposition of real, personal, or mixed property, the basis shall be, in the case of property acquired before January 1, 1928, the assessed valuation of such property on the county tax books as of that da…

(a) (1) For the purpose of determining gain or loss, when property is exchanged for other property the property received in exchange shall be treated as the equivalent of cash to the amount of its fair market value if a market exists in which all the property so received can be d…

(a) Title 26 U.S.C. §§ 332, 334, 336, 337, and 338, as in effect on January 1, 2007, regarding the liquidations of corporations, are adopted for the purpose of computing Arkansas income tax liability. (b) For the purposes of the application of this section, the transition rule of…

(a) (1) The following sections relating to annuities, retirement savings, and employee benefit plans are adopted for the purpose of computing Arkansas income tax liability, except Arkansas capital gains treatment and the Arkansas tax rates shall apply:(A) Title 26 U.S.C. §§ 72, 2…

Title 26 U.S.C. § 163, as in effect on January 1, 2017, regarding deductions for interest expenses, is adopted for the purpose of computing Arkansas income tax liability.

In computing net income, there shall be allowed as deductions taxes paid or accrued within the income year, imposed by the authority of the United States or any of its possessions or of any state, territory, or any political subdivision of any state or territory, or the District …

(a) Title 26 U.S.C. § 71 [repealed], in effect on January 1, 1987, is adopted for purposes of determining the amount of alimony or separate maintenance to include in the gross income of the recipient. (b) Title 26 U.S.C. § 215 [repealed], in effect on January 1, 1987, is adopted …

(a) In addition to any other state income tax deduction permitted by law, a taxpayer in this state who is maintaining, supporting, and caring for a totally and permanently disabled child in his or her home shall be permitted a deduction on his or her Arkansas income taxes of five…

(a) (1) Title 26 U.S.C. § 170, as in effect on January 1, 2019, regarding deductions for charitable contributions, is adopted for the purpose of computing Arkansas income tax liability.(2) However, with respect to contributions of qualified appreciated stock within the meaning of…

Education service cooperatives created under The Education Service Cooperative Act of 1985, § 6-13-1001 et seq., are declared instrumentalities and political subdivisions of the State of Arkansas, and all contributions and donations made to them in any calendar year are deductibl…

(a) In computing net income for the purposes of the Income Tax Act of 1929, § 26-51-101 et seq., there shall be allowed as deductions in addition to all other deductions allowed by law the fair market value of donated artistic, literary, and musical creations if:(1) The taxpayer …

(a) (1) In computing net income, there shall be allowed as deductions the following expenses:(A) BUSINESS EXPENSES. All of 26 U.S.C. § 162, except subsection (n), as in effect on January 1, 2019, regarding trade or business expenses, is adopted for the purpose of computing Arkans…

(a) (1) In computing net income there shall be allowed as a deduction any loss sustained during the income year and not compensated for by insurance or otherwise.(2) In the case of an individual, the deduction under subdivision (a)(1) of this section shall be limited to:(A) Losse…

In computing net income there shall be allowed as deductions debts ascertained to be worthless and actually charged off the books of the taxpayer within the income year.

Any bank, building and loan, savings and loan, or any other savings institution chartered and supervised as a savings and loan or similar associations under federal or state law shall be allowed a bad debt expense deduction computed in accordance with 26 U.S.C. §§ 582, 585, and 5…

(1) In addition to other deductions allowed by this chapter, there is allowed as a deduction from gross income a net operating loss carryover under the following rules:(1) (A) The net operating loss for any taxable year may be carried over to the next-succeeding taxable year and …