Arkansas (AR) Paycheck Calculator 2026

How Arkansas employers figure withholding

Arkansas withholding is based on Form AR4EC, the Employee's Withholding Exemption Certificate. You claim one exemption for yourself, two if you claim your spouse or file as head of household, and one for each dependent. Each exemption is worth a $29 tax credit in the 2026 formula. If you do not file an AR4EC, your employer must withhold with no exemptions or dependents.

Employers that run computerised payroll use the Department of Finance and Administration (DFA) formula method:

• Annualise the paycheck: monthly pay × 12, semi-monthly × 24, bi-weekly × 26, weekly × 52.
• Subtract the $2,470 standard deduction to get net taxable income.
• Apply the brackets: 0% up to $5,599, then 2.0%, 3.0%, 3.4%, 3.9%, with the top 3.9% rate from about $26,400.
• Subtract $29 for each exemption on the AR4EC, then divide by the number of pay periods.

Worked example: $5,000 a month, married with one child

A married employee paid $5,000 a month ($60,000 a year) who claims self, spouse and one child has three exemptions. Annual wages of $60,000 less the $2,470 standard deduction leave $57,530. The bracket tax on that is $1,824, and three $29 credits bring it to $1,737 for the year, or $145 per monthly paycheck (2.89% of gross).

The DFA formula's table also contains a narrow band between $94,701 and $97,800 where the "minus adjustment" shrinks in $100 steps. That is the payroll version of the rule that higher earners lose the benefit of the lower brackets, so withholding climbs a little faster than 3.9% across that range.

Low-income rates, Texarkana and other AR4EC boxes

The AR4EC has two features that can cut withholding sharply for the right employees:

• Line 5, low-income tax rates: employees whose total income from all sources falls within the low-income table ranges printed on the form can check "Yes" so withholding reflects the lower rates they will actually pay.
• Form AR4EC(TX), the Texarkana exemption: people who live within the city limits of Texarkana, Arkansas, or Texarkana, Texas, can claim the border-city exemption from Arkansas income tax withholding. A street address is required (no P.O. boxes), and the employee must tell the employer within seven days if their status changes.
• Additional withholding (line 4) is the place to cover side income or a working spouse.
• If a spouse or dependent dies, the decrease does not change your withholding until the next year, but you must file a new AR4EC by December 1 of the year it happens.

Bonuses, remote work and other pay

When bonuses, commissions or overtime are paid at the same time as regular wages, DFA's employer instructions say to deduct a flat 3.9% of the bonus or commission for state income tax. DFA warns that this can over-withhold, and the excess comes back only when you file your return.

Remote work is treated generously. Under Act 1019 of 2021, a nonresident who works partly inside and partly outside Arkansas is taxed only on pay for days physically worked in Arkansas, and a nonresident who works entirely from outside Arkansas owes Arkansas nothing on those wages, even if the employer is based in Little Rock.

Arkansas has no local income taxes and no employee-paid disability or paid-leave premiums, so the only state line on your pay stub is income tax.