Arkansas Other Income: Filing and Reporting Guidelines
When filing your Arkansas state income tax return, you may need to report "Other Income" that does not fall under standard wage, interest, or dividend categories. This includes income from sources such as rental properties, self-employment, or other non-wage earnings. Arkansas requires taxpayers to report all income earned while residing in the state or derived from Arkansas sources.
What is Considered "Other Income" in Arkansas?
- Income from rental properties
- Self-employment earnings
- Business income not reported on Form 1099-NEC or W-2
- Other miscellaneous income not categorized under standard forms
According to Arkansas tax guidelines, you must report all income from all sources, including "Other Income," on your state return. The state uses Form AR1000F (Individual Income Tax Return) as the primary form for residents, and Form AR1000NR for part-year or non-residents.
Reporting Other Income on Arkansas Tax Forms
To report "Other Income" in Arkansas, you may need to use Form AR1000D (Capital Gain) or Form AR-OI (Other Income/Loss and Depreciation Differences), depending on the nature of the income.
- Form AR-OI: Automatically generated by tax software if you enter information in the "Arkansas State - AR1000 Other Income" section. This form is used to report other income, losses, and depreciation differences.
- Form AR1000D: Used specifically for reporting capital gains. In Arkansas, only 50% of net long-term capital gains are taxed, while 100% of short-term capital gains are taxed.
When using tax preparation software provided by Online Taxes (OLT), you can add these forms by navigating to the "State" section, selecting Arkansas, and following on-screen prompts. The software will guide you through entering your personal, income, and deduction information.
Apportionment of Income for Non-Residents and Part-Year Residents
For taxpayers who are not full-year residents of Arkansas, income must be apportioned based on time spent in the state or income derived from Arkansas sources. You must enter total income in Column A, total adjustments in Column B, and Arkansas-sourced income in Column C.
The tax is computed using the total income (Column A and B), and then prorated based on the percentage of income earned in Arkansas (Column C). This is calculated using the formula:
- Line 38B: Total of Columns A and B from line 25
- Line 38C: Divide Line 38A by Line 38B to get the Arkansas percentage of income (as a decimal)
- Line 38D: Multiply total tax by the decimal from Line 38C to get the apportioned tax liability
Important Notes
- Non-taxable income in Arkansas includes child support, welfare benefits, life insurance proceeds (lump sum), tax-exempt interest, accident and health insurance proceeds, gifts, inheritances, and cash rebates.
- If you itemize deductions, you must use the Regular Income Tax Table — you cannot use low-income tax tables.
- Military compensation, military retirement, or employment-related pension income exemptions disqualify you from using low-income tax tables.
Source:
Form AR1000F and AR1000NR Instructions
Form AR1000D - Capital Gain
Form AR-OI - Other Income/Loss and Depreciation Differences
Disclaimer: Always verify information with official Federal or State Department of Revenue Forms and Instructions before filing your return.