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Corporate FAQs

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Corporate FAQs

When is an Arkansas “C” corporation income tax return due?

Arkansas Code Annotated (ACA) §26-51-806 requires Arkansas corporation income tax returns to be filed on or before April 15 for the preceding calendar year.  Returns are due on or before the 15th day of the 4th (fourth) month (3 ½  months) after the close of the corporation’s tax year if covering a fiscal year.

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What tax identification number is required for the Arkansas corporation income tax return?

Arkansas requires all corporations to use the employer identification number (EIN), also referred to as a federal employer identification number (FEIN), assigned to the corporation by the Internal Revenue Service.

To obtain an EIN, contact the Internal Revenue Service or visit their website for instructions.  Use IRS Form SS-4 (Application for Employer Identification Number) to apply for an employer identification number (EIN), or apply online. https://sa.www4.irs.gov/applyein/

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What is the statute of limitations for filing an Arkansas amended corporation income tax return?

ACA 26-18-306(i) states that an amended return may be filed within three (3) years of the original return filing date or two (2) years from the date the tax was paid, whichever event occurred later.

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Who must sign the Arkansas corporation income tax return (Form AR1100CT) or the Arkansas amended corporation income tax return?

ACA 26-51-804(b) requires the return to be signed by a corporate officer, which may be the president, vice-president, treasurer, or other principal officer. If someone other than a corporate employee prepared the return, that individual or firm must also sign the return as the preparer and provide the requested information.

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Will Arkansas recognize an automatic federal extension, Form 7004?

Yes. ACA §26-51-807 states any person who requests an automatic extension of time for filing a federal income tax return will be granted an extension of time for filing the corresponding Arkansas income tax return until the extended due date of the federal return. A copy of Federal Form 7004 is no longer required to be attached to the Arkansas return if the Federal Extension box is checked on Arkansas FormAR1100CT.

However, interest at the rate of ten percent (10%) per annum is due on all returns (including those with extensions) if the tax is not paid by the original return due date. Interest will be computed on a daily rate of .00027397 (.027397%). To avoid interest and/or penalty, any tax due payment must be made on or before the 15th day of the 4th month following the close of the Corporation’s tax year. Any tax due balance remaining after the original Arkansas return due date or the extended return due date will be subject to the penalties referenced in ACA §26-18-208.

Act 629 of 2021 amends Arkansas Code Annotated 26-51-807(a)to allow taxpayers an extension to file of one month after the extended due date for a federal income tax return for tax years beginning on or after January 1, 2021. The one-month extended due date does not apply to returns for which a federal extension is not requested and does not extend the original due date. All tax payments are due on the original return due date, interest at 10% per annum, and failure to pay penalties at 5% per month will be assessed on all taxes unpaid after the original due date of April 15 for calendar year returns and the 15th day of the fourth month after the end of a tax year for fiscal year returns filed.

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Will Arkansas grant an extension beyond the federal automatic extension?

Yes. ACA §26-18-505 states that, for good cause and upon written request, an Arkansas extension of 60 days beyond the automatic federal extension due date will be granted. Complete and mail the Arkansas form AR1155, Request for Extension of Time for Filing Income Tax Returns, by the federal extended due date to the Corporation Income Tax Section. The Arkansas extension request must be postmarked on or before the Arkansas return due date or the federal extended return due date, whichever is applicable. Arkansas extensions must be attached to the Arkansas income tax return.

Any tax due balance remaining after the original Arkansas return due date or the extended return due date will be subject to the penalties referenced in ACA 26-18-208 and interest as provided in ACA §26-18-508.

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Is a copy of the corporation’s federal income tax return (Form 1120, 1120A, or 1120S) required to be attached to the Arkansas return?

Yes. ACA §26-51-806(d)(1) requires every corporation filing an Arkansas corporation income tax return to attach a completed copy of its federal tax return as filed with the IRS, including all schedules and attachments.

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When should an Internal Revenue Service Revenue Agent’s Report (RAR) be reported to Arkansas?

ACA §26-18-306(b) requires any change or correction by the IRS to be reported to Arkansas within one hundred eighty (180) days from the receipt of the notice and demand for payment from the Internal Revenue Service. The RAR must be reported on an Arkansas form AR1100CT and check the Amended return box on the form for tax years 2010 and after. Use form AR1100CTX if amending tax years 2009 and prior.

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What are the requirements to file an Arkansas consolidated income tax return?

ACA 26-51-805 establishes which corporations are eligible to be a member of an Arkansas consolidated group. The following is a brief summary of those requirements:

  1. All federal eligible members must be a part of the federal consolidated income tax return.
  2. Only those federal eligible members with income sources within Arkansas may be part of Arkansas consolidated group.
  3. All of the Arkansas eligible members must consent to and join in the filing of Arkansas consolidated return prior to the last day for filing a return.
  4. Once election to file an Arkansas consolidated return is made, all Arkansas eligible members must continue to file as part of the Arkansas consolidated group.

Each entity in the Arkansas consolidated group must separately compute its taxable income or loss on a separate form AR1100CT and consolidate the total taxable income or loss from each entity on a group return, form AR1100CT.

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Has Arkansas adopted the new federal depreciation rules?

No bonus depreciation is allowed for Arkansas income tax purposes.

ACA 26-51-428 does not adopt the bonus depreciation provisions contained in Internal Revenue Code 168(k). For Arkansas income tax purposes, Internal Revenue Code Sections 167 and 168 (a) – (j) as in effect on January 1, 2019, are adopted for tax years beginning on or after January 1, 2019.

Internal Revenue Code Section 179 as in effect on January 1, 2022, is adopted for tax years beginning on or after January 1, 2022.

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Are corporations allowed to deduct Arkansas income tax on the Arkansas return?

No. ACA §26-51-416 does not allow Arkansas or federal income tax as a deduction.

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Is a net operating loss (NOL) carry-back allowed on the Arkansas return?

Act 822 amends Arkansas Code Annotated 26-51-427 to allow net operating losses occurring in tax years beginning on or after January 1, 2020, to be carried forward 8 tax years and net operating losses occurring in tax years beginning on or after January 1, 2021, to be carried forward 10 tax years. Tax years before January 1, 2020, net operating loss (NOL) will carry forward 5 tax years.

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What are the new rules & regulations for apportionment of multistate income on the Arkansas corporation income tax return?

Act 822 of 2019 amends Arkansas Code Annotated 26-5-101, Article IV and 26-51-709 through 26-51-718 to provide for a single sales factor to apportion income from within and without Arkansas. For tax years beginning on or after January 1, 2021, all taxpayers with income from sources within and without Arkansas must use a single sales factor to apportion income from Arkansas. 

On April 16, 2025, Arkansas Gov. Sarah Huckabee Sanders signed Senate Bill 567 into law as Act 719 of 2025, modernizing the state’s corporate income tax. The Act adopts Market-Based Sourcing for Sales of Services and Intangibles, which is based on the location where they are delivered to the customer.

Taxpayers subject to a special industry apportionment method, as authorized below, should use single sales factor apportionment while still applying the special guidance provisions in the rule concerning the sales factor. ACA §26-51-718(c)

 1. Private Railcar Operators by Rule 26 CAR §130-114

 2. Construction Contractors by Rule 26 CAR §130-144(a)

 3. Television and Radio Broadcasting by Rule 26 CAR §130-144(b)

 4. Publishing by Rules 26 CAR §130-144(c) and

 5. Pipelines by Rule 26 CAR §130-144(f)

Act 658 of 2023 amended Arkansas Code Annotated 26-51-204 to allow Railroad operators the option to apportion income using sales factor only or using property, payroll, and (2) times the sales factor as provided for in the code.  

Airlines are required to use sales factor apportionment only under Rule 26 CAR §130-144(d) and Bus Lines and Trucking Companies are required to apportion using a mileage factor only under Rule 26 CAR §130-144(e).

Taxpayers in these special industries should use Form AR-718 to calculate Arkansas apportionment.

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When are Arkansas “C” corporation estimated income tax payments due?

ACA §26-51-913 amended the due date for Arkansas “C” corporation estimated income tax payments for tax years beginning on or after January 1, 2003, as follows:

  1. First installment, Voucher 1, is due on or before the 15th day of the fourth month of the tax year.
  2. Second installment, Voucher 2, is due on or before the 15th day of the sixth month of the tax year.
  3. Third installment, Voucher 3, is due on or before the 15th day of the ninth month of the tax year.
  4. Fourth installment, Voucher 4, is due on or before the 15th day of the twelfth month of the tax year.

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Why are certain corporations required to pay their estimated quarterly income tax payments through the Electronic Funds Transfer (EFT) method?

ACA §26-19-106 requires any corporation with an estimated quarterly income tax liability equal to or greater than twenty thousand dollars ($20,000) to pay its estimated quarterly income tax due by the EFT method. The Corporation Income Tax Section will determine which corporations will be required to remit their estimated quarterly income tax payments through the EFT method. This determination will be based on the corporation’s average quarterly tax liability for its prior tax year.

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May a corporation voluntarily pay its estimated quarterly income tax payments through the Electronic Funds Transfer (EFT) method?

A corporation may voluntarily participate in the EFT payment method using the Arkansas Taxpayer Access Point (ATAP) website, www.atap.arkansas.gov. (ACH Debit Payment Option)

The ACH credit payment method is also available, which allows a taxpayer to transfer funds by instructing their financial institution to debit their account and to credit the state’s bank account.  ACH Credit instructions are available on the Department’s website:  https://www.dfa.arkansas.gov/office/taxes/excise-tax-administration/sales-use-tax/electronic-filing-and-payment-options/

All payments may be made through EFT(ACH Debit or Credit), ATAP, check, or by visiting our office in person at 1816 W. 7th Street, Room 2250, Little Rock, AR. The taxpayer must be able to verify their payment account in order to make a payment. Corporation Income Tax does not accept credit cards or wire transfers for payments.

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Will the corporation be penalized if it does not remit its estimated quarterly income tax payment through the EFT method?

Yes. §ACA 26-19-107 authorizes the assessment of a five percent (5%) penalty based on the amount of taxes due. This penalty is in addition to any other penalty authorized in ACA §26-18-208. The penalties stated above will apply to those corporations required to pay estimated quarterly income tax payments through the EFT method.

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Does Arkansas have any way to make online payments?

Yes. Taxpayers can make eligible online payments through the Arkansas Taxpayer Access Point. (ATAP): https://atap.arkansas.gov/_/

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Who do we contact regarding the Arkansas corporation franchise tax, filing articles of incorporation, dissolving a corporation, etc.?

Arkansas Secretary of State, State Capitol Building, Attention Corporation Division, Little Rock, AR 72201, telephone number (501) 682-3409 or 501-682-1010. The website can be found at www.sos.arkansas.gov.

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 What type of nexus standard does Arkansas adopt for Corporations?

Act 719 of 2025 amended ACA §26-51-202 concerning the taxation of non-residents, adopting an economic corporate income tax nexus.  Effective January 1, 2026, Arkansas established a corporate economic nexus threshold of $250,000 in gross receipts for nonresident corporations or partnerships with no physical presence.  No physical presence is required to establish an income tax filing requirement.  

However, any non-resident corporation or partnership with a physical presence in Arkansas engaging in unprotected activities in Arkansas will still also establish nexus and an income tax filing requirement, even if it is below the economic receipt’s threshold. ACA §26-51-702 & 26 CAR§ 130-136.

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What is the tax rate for Corporations in Arkansas?

Arkansas utilizes a graduated corporate income tax rate ranging from 1.0% to 4.3%. 

ACA §26-51-205. Act 1 (SB1) and Act 4 (HB1001) of the Second Extraordinary Session of 2024 reduced the top corporate income tax rate for both domestic and foreign corporations to four and three-tenths percent (4.3%) for tax years beginning on or after January 1, 2024.

 The Act established the following rates for tax years beginning on or after January 1, 2024:

1. On the first $3,000 of net income ……………………….  1.0%

2. On the second $3,000 of net income……………………  2.0%

3. On the next $5,000 of net income……………………….  3.0%

4. On all net income exceeding $11,000………………….. 4.3%

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