Arkansas State Income Tax Withholding Information

State Abbreviation:

AR

State Tax Withholding State Code:

05

Basis For Withholding:

State Exemptions

Acceptable Exemption Form:

AR4EC or W-4

Acceptable Exemption Data:

S, M, N, H, 0 /Number of Dependents

TSP Deferred:

Yes
Special Coding:

Determine the Total Number Of Allowances field as follows:

First Position - S = Single; M = Married, Claiming Both Husband and Wife; N = Married, Claiming Self Only; H = Head of Household; 0 (zero), No Personal Exemption or Dependents Claimed.

Second Position - Enter the number of exemptions claimed for dependents. If less than 10, precede with a zero. If no dependents are claimed, enter 00 in the second and third positions.

Additional Information:

None
Additional Resources:

TAXES 06-23, Arkansas State Income Tax Withholding

Withholding Formula (Effective Pay Period 11, 2006)

  1. Subtract the biweekly Thrift Savings Plan contribution from the gross biweekly wages.

  2. Subtract the nontaxable biweekly Federal Health Benefits Plan payment(s) (includes flexible spending account - health care and dependent care deductions) from the amount computed in step 1.

  3. Add the taxable biweekly fringe benefits (taxable life insurance, etc.) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.

  4. Multiply the gross biweekly wages by 26 to obtain the annual wages.

  5. Subtract the standard deduction of $2,000 from the result of step 2 to compute the taxable income.

  6. Apply the taxable income computed in step 3 to the following table to determine the annual Arkansas tax withholding.

    Tax Withholding Table

    If the Amount of
    Taxable Income Is:

    The Amount of Arkansas
    Tax Withholding Should Be:

    Over:

    But Not
    Over:

    		  

    Of Excess
    Over:

    $0

    $3,000

    $0

    plus

    1.0%

    $0

    3,000

    6,000

    30

    plus

    2.5%

    3,000

    6,000

    9,000

    105

    plus

    3.5%

    6,000

    9,000

    15,000

    210

    plus

    4.5%

    9,000

    15,000

    25,000

    480

    plus

    6.0%

    15,000

    25,000

    and over

    1,080

    plus

    7.0%

    25,000
  7. Determine the personal tax credit by applying the following guideline and subtract this amount from the result of step 4 to compute the annual Arkansas tax withholding.

    If the Employee Is Claiming Status As:

    Then the Annual Exemption Allowance Should Be:

    Single - Personal Exemption Code S

    $20

    Married - Personal Exemption Code M

    $40

    Married - Personal Exemption Code N

    $20

    Head of Household - Personal Exemption Code H

    $40

    Zero - Personal Exemption Code 0 (zero)

    $0
  8. If the employee claims any dependent exemptions, multiply each by $20 and add this to the annual exemption amount computed above.

    Note: The personal exemption code is based on the marital status in the first position of the exemption code recorded on the Information/Research Inquiry System (IRIS), Program IR105, State Tax. The dependent exemptions are the last two positions of the exemption code on IRIS Program 105. For example, if the employee has an exemption code of H02, they would receive a personal tax credit of $80 which is $40 for Head of Household and $40 for the 2 dependent exemptions.

  9. Divide the annual Arkansas tax withholding by 26 to obtain the biweekly Arkansas tax withholding.