Arkansas uses a five-bracket graduated income tax with a top rate of 3.70% for TY2026, enacted by H.B. 1001 (Special Session, 2025), retroactive to January 1, 2026. The standard deduction is $2,470 per taxpayer ($4,940 for MFJ): a per-taxpayer model confirmed in AR DFA instructions.The state sales tax on groceries was fully repealed effective January 1, 2026, though local food taxes still apply. OBBBA conformity (tips, overtime, senior) has not yet been confirmed by AR DFA: verify before filing.
Top Income Tax Rate
3.70% (above $26,400)
Standard Deduction
$2,470 per taxpayer / $4,940 MFJ
State Grocery Tax
0% (repealed 2026)
OBBBA Conformity
Unknown: AR DFA guidance pending
Arkansas Income Tax Brackets 2026
H.B. 1001 (Special Session, 2025) enacted a new five-bracket schedule retroactive to January 1, 2026. The same brackets apply to all filing statuses. Arkansas's bracket thresholds are not indexed for inflation.
Arkansas Taxable Income (All Filing Statuses)
Rate
$0 – $5,599
0.00%
$5,600 – $11,199
2.00%
$11,200 – $15,999
3.00%
$16,000 – $26,399
3.40%
$26,400 – and above
3.70%
Arkansas Standard Deduction 2026
Arkansas provides a per-taxpayer standard deduction of $2,470. This amount is confirmed in the 2025 AR1000F instructions: "$2,470 per taxpayer ($4,940 if married filing jointly)." The 2026 DFA withholding formula (posted May 29, 2026) confirms the same deduction amounts after the H.B. 1001 rate changes. Arkansas's standard deduction is not indexed for inflation.
Filing Status
Standard Deduction
Single
$2,470
Married Filing Jointly
$4,940
Married Filing Separately
$2,470
Head of Household
$2,470
Arkansas Grocery Tax Repeal 2026
Arkansas fully repealed the state sales tax on food and food ingredients effective January 1, 2026. The state grocery tax rate is 0% for TY2026 (a complete repeal of the prior 0.125% rate). Local city and county sales taxes on food continue to apply at full local rates: Arkansas allows local sales taxes up to 5.5%, so combined grocery tax rates in some jurisdictions remain significant despite the state-level repeal.
Arkansas OBBBA Conformity Status
Arkansas conformity to the OBBBA deductions (tips, overtime, senior bonus) has not yet been addressed by the Arkansas Department of Finance and Administration. Arkansas has its own income tax code and no AR DFA guidance on OBBBA conformity has been identified as of July 2026. Do not assume these federal deductions automatically apply to Arkansas income: verify with AR DFA before filing.
Arkansas uses a five-bracket graduated income tax for TY2026, enacted by H.B. 1001 (Special Session, 2025), retroactive to January 1, 2026: 0% on income up to $5,599; 2% on $5,600–$11,199; 3% on $11,200–$15,999; 3.4% on $16,000–$26,399; and 3.70% on income above $26,400. Arkansas applies the same bracket schedule for all filing statuses. This rate cut (from a prior 3.9% top rate) reflects Arkansas's ongoing income tax reduction strategy.
What is Arkansas' standard deduction for 2026?
Arkansas uses a per-taxpayer standard deduction of $2,470. This applies to single filers, married filing separately, and head of household. Married filing jointly filers receive $4,940 (two taxpayers × $2,470 each). The per-taxpayer language is explicit in AR DFA's 2025 AR1000F instructions: "$2,470 per taxpayer ($4,940 if married filing jointly)." The 2026 DFA withholding formula (posted May 29, 2026) confirms the same deduction amounts. Arkansas's standard deduction is not indexed for inflation.
Does Arkansas conform to the OBBBA tips, overtime, or senior bonus deductions?
Arkansas conformity to the OBBBA deductions (tips, overtime, senior bonus) has not yet been confirmed or denied by the Arkansas Department of Finance and Administration (DFA). Arkansas has its own income tax code and no AR DFA guidance on OBBBA conformity has been published as of July 2026. Check the AR DFA website for updates before assuming the federal deductions reduce Arkansas taxable income.
Does Arkansas tax groceries?
Arkansas eliminated the state sales tax on groceries effective January 1, 2026. The state grocery tax rate is now 0% for TY2026 (a full repeal, not a reduction: the prior rate was 0.125% in 2025). However, local city and county sales taxes on food continue to apply at full local rates. Arkansas allows local sales taxes up to 5.5%, so combined grocery tax rates in some jurisdictions remain substantial despite the state-level repeal.
What is Arkansas' supplemental withholding rate for 2026?
Arkansas's supplemental withholding rate (used for bonuses and other supplemental wages) is 3.70%: equal to the new top marginal rate enacted by H.B. 1001 (Special Session, 2025). This rate replaced the prior 3.9% supplemental rate effective for TY2026.
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