Arkansas State Income Tax Withholding

Reference Number: NFC-24-1708094270
Published: March 19, 2024
Effective: Pay Period 03, 2024

Summary

The State of Arkansas income tax withholding formula includes the following changes:

No action on the part of the employee or the personnel office is necessary.

Tax Formula

State Abbreviation:

AR

State Tax Withholding State Code:

05

Acceptable Exemption Form:

AR4EC or W-4

Basis for Withholding:

Based on State taxable wages

Acceptable Exemption Data:

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

TSP Deferred:

Yes

Special Coding:

Determine the Total Number of Allowances Claimed field as follows:

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

Second and Third Positions - Enter the number of exemptions claimed for dependents. If less than 10, precede with a 0 (zero). If no dependents are claimed, enter 00 in the second and third positions.

Additional Information:

In the event that the employee does not file a State withholding exemption certificate, then zero (0) exemptions will be used as the basis for withholding.

Withholding Formula (Effective Pay Period 03, 2024)

  1. Subtract the nontaxable biweekly Thrift Savings Plan contribution from the gross biweekly wages.
  2. Subtract the nontaxable biweekly Federal Employees Health Benefits Plan payment(s) (includes dental and vision insurance program and Flexible Spending Account — health care and dependent care deductions) from the amount computed in step 1.
  3. Add the taxable biweekly fringe benefits (e.g., taxable life insurance) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.
  4. Multiply the adjusted gross biweekly wages by the number of pay dates in the tax year to obtain the gross annual wages.
  5. Subtract the Standard Deduction of $2,340 from annualized gross pay in step 4 to determine annual net taxable income.
  6. If the annual net taxable income is less than $100,001, truncate (shorten) the annual net taxable income to the nearest $100, and then add $50. If the annual net taxable income is $100,001, or more, there is no adjustment to the annual net taxable income amount.

For example: If the annual net taxable income is $23,324, truncate to $23,300, and add $50. The amount to be used in calculating the annual gross tax amount is $23,350.

  1. Apply the tax rates below to the annual net taxable income and subtract the minus adjustment amount. Round the result to the nearest whole dollar. This is the annual gross tax amount.

Net Taxable Income:

Amount of Tax:

$0 but not over $5,300

0%

$5,300 but not over $10,600

2.00% minus $105.98

$10,600 but not over $15,100

3.00% minus $211.97

$15,100 but not over $25,000

3.40% minus $272.37

$25,000 but not over $89,601

4.40% minus $522.36

$89,601 but not over $89,701

4.40% minus $506.40

$89,701 but not over $89,801

4.40% minus $496.40

$89,801 but not over $89,901

4.40% minus $486.40

$89,901 but not over $90,001

4.40% minus $476.40

$90,001 but not over $90,201

 4.40% minus $466.40

$90,201 but not over $90,301

4.40% minus $456.40

$90,301 but not over $90,401

4.40% minus $446.40

$90,401 but not over $90,501

4.40% minus $436.40

$90,501 but not over $90,601

4.40% minus $426.40

$90,601 but not over $90,701

4.40% minus $416.40

$90,701 but not over $90,801

4.40% minus $406.40

$90,801 but not over $90,901

4.40% minus $396.40

$90,901 but not over $91,101

4.40% minus $386.40

$91,101 but not over $91,201

4.40% minus $376.40

$91,201 but not over $91,301

4.40% minus $366.40

$91,301 but not over $91,401

4.40% minus $356.40

$91,401 but not over $91,501

4.40% minus $346.40

$91,501 but not over $91,601

4.40% minus $336.40

$91,601 but not over $91,701

4.40% minus $326.40

$91,701 but not over $91,801

4.40% minus $316.40

$91,801 but not over $91,901

4.40% minus $306.40

$91,901 but not over $92,001

4.40% minus $296.40

$92,001 but not over $92,101 

4.40% minus $286.40

$92,101 but not over $92,201

4.40% minus $276.40

$92,201 but not over $92,301

4.40% minus $266.40

$92,301 but not over $92,401

4.40% minus $256.40

$92,401 but not over $92,501

4.40% minus $246.40

$92,501 but not over $92,601

4.40% minus $236.40

$92,601 but not over $92,701

4.40% minus $226.40

$92,701 but not over $92,801

4.40% minus $216.40

$92,801 but not over $92,901

4.40% minus $206.40

$92,901 but not over $93,001

4.40% minus $196.40

$93,001 but not over $93,101

4.40% minus $186.40

$93,101 but not over $93,201

4.40% minus $176.40

$93,201 but not over $93,301

4.40% minus $166.40

$93,301 but not over $93,401

4.40% minus $156.40

$93,401 but not over $93,501

4.40% minus $146.40

$93,501 but not over $93,601

4.40% minus $136.40

$93,601 but not over $100,001

4.40% minus $126.40

Over $100,001

4.40% minus $126.40

 

  1. If the employee has elected to use the low income tax tables, calculate the low income tax credit based on filing status using the formula below. If the result is less than zero, the low income tax credit is zero. Reduce the annual gross tax calculated in the previous step by the low income tax credit. Use the employee's annual wages calculated in step 4 in the tax credit formula.

Filing Status

Tax Credit Formula

Single

 (1 - (Annual Wages - $13,850*) / ($16,500 - $13,850)) x $107.64

Married (<= 1 exemption)

(1 - (Annual Wages - $23,357*) / ($27,500 - $23,357)) x $371.80

Married (>=2 exemptions)

(1 - (Annual Wages - $28,111*) / ($34,100 - $28,111)) x $505.96

Head of Household (<=1 exemption)

(1 - (Annual Wages - $19,692*) / ($23,900 - $19,692)) x $253.76

Head of Household (>=2 exemptions)

(1 - (Annual Wages - $23,473*) / ($27,400 - $23,473)) x $357.76

* If less than zero, the tax credit is equal to the standard tax and the pay period tax is zero.

  1. Multiply the total number of withholding exemptions by $29.00 to determine the personal tax credit.
  2. Subtract the personal tax credit from the annual gross tax in step 7 to determine the annual net tax. The result cannot be less than zero.
  3. Divide the Arkansas annual net tax withholding determined by the number of pay dates in the tax year to obtain the biweekly Arkansas income tax withholding.

Resources

To view the updated tax formula, go to the HR and Payroll Clients page from the MyNFC drop-down menu on the National Finance Center (NFC) Home page. Select the Publications tab and select Taxes from the Publications Library section to launch the tax map. Select the desired State from the map provided for the formula.

Previous Tax Bulletin

Inquiries

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