StateSide

AR · payroll profile

Arkansas

Everything an out-of-state employer needs before running a Arkansas payroll: what to withhold, which form the employee signs, whether reciprocity applies, and who to register with.

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Personal income tax
Graduated to 3.9%
Reciprocal agreements
None
SUI wage base 2026
$7,000
Local income taxes
No

Income tax withholding

Imposes wage income tax Yes
Rate structure Graduated, top marginal rate 3.9%
Withholding certificate AR4EC
Employee's Withholding Exemption Certificate
Accepts federal Form W-4 No
Convenience-of-the-employer rule No
Nonresident withholding threshold From the first dollar
Withholding required from the first dollar of wages for services physically performed in Arkansas. NOTE: Arkansas REPEALED its convenience-of-the-employer test with Act 1019 of 2021 -- wages earned by a nonresident for work performed entirely outside Arkansas are no longer Arkansas-source, even if the employer is in Arkansas.
Local income taxes No
No local personal income or wage taxes in Arkansas.

Reciprocity

States that exempt Arkansas residents

A Arkansas resident working in these states files that state's certificate and is taxed only by Arkansas.

District of Columbia

Unemployment insurance and paid leave

Taxable wage base 2026 $7,000
2025 base was $7,000.
New employer rate 1.8%
Experience rate range 0.1% – 6%
Experience-rating method reserve ratio
Employee UI contribution No
Paid family / medical leave No

Employer registration

Tax agency
Arkansas Department of Finance and Administration, Withholding Tax Branch
UI agency
Arkansas Division of Workforce Services

Sources

dfa.arkansas.gov · taxfoundation.org · rsmus.com · oui.doleta.gov · oui.doleta.gov · oui.doleta.gov

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This is a determination aid, not advice. StateSide encodes published state rules and applies them mechanically to the facts you enter. It does not know your entity structure, your nexus history, your equity compensation, or the dozens of exceptions that turn a clean rule into a judgement call. Every determination cites the state source it came from — verify against that source, and take anything consequential to a payroll tax professional before you act on it.