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Arkansas Retirement Tax Calculator: Pension and IRA Exemption and 2026 Rates

Arkansas does not tax Social Security, railroad retirement or U.S. military retirement pay. Each retiree exempts the first $6,000 of employer pension or traditional IRA income (IRA payouts after age 59½), and the rest is taxed at rates up to 3.7% for 2026 under Act 2 of 2026.

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Arkansas resident retirement worksheet

Use the year income is received, not the filing year. Later years use a separately approved assessment until the next return rules are verified.

Approved 2026 Arkansas income after basis and all other state modifications, before the retirement exclusions below. Social Security, qualified railroad benefits and other already-exempt income are outside this base. Regular schedule election independently approved; no low-income alternative, negative income, special lump-sum election or unresolved owner / deduction allocation. This is a statutory rate estimate, not a final return lookup.

Joint filing pools approved owner amounts for one rate calculation. Separate filing on the same return calculates each column independently. Reapprove income and deduction allocations when changing methods.

State income after contribution basis and other approved state modifications. Includes the two distinct retirement categories below; excludes Social Security and qualified railroad benefits already outside Arkansas income.

Combined eligible employment-related pension and IRA distributions after basis. IRA eligibility uses age 59½ when distributed, or qualifying death / disability. A medical, education or home-purchase federal exception does not establish Arkansas eligibility. Include nonqualifying taxable distributions only in prepared income, not here.

Fully exempt approved uniformed-service retirement or retirement-funded survivor benefits. Below $6,000, only the unused portion of the same owner’s $6,000 allowance remains for eligible pension / IRA income; at $6,000 or more, no ordinary plan allowance remains.

Prepared standard or itemized amount and allocation. The published estimate lists $2,470 per taxpayer; special limitations and low-income elections require separate review. This does not update automatically when filing method changes.

Spouse’s approved state income, distinct from yours; exempt benefits already removed.

Separate qualifying recipient; your unused allowance cannot cover this owner’s income.

Apply the military / ordinary retirement allowance interaction separately for this owner.

Separately approved standard or itemized amount and allocation. The joint example totals $4,940; separate columns require individually prepared deductions.

Prepared applicable personal, age, dependent and other nonrefundable credits. Do not enter withholding, estimated payments or refundable credits. Blank keeps the before-credit estimate and leaves the after-credit amount unknown.

Arkansas · 2026 statutory rate estimate

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Arkansas statutory rate estimate before credits —
Your military plus remaining eligible plan exclusions
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Spouse’s military plus remaining eligible plan exclusions
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Modeled adjusted Arkansas income
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Modeled taxable income total
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Your separate-column taxable income
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Spouse’s separate-column taxable income
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Enacted upper-income bracket adjustment
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Rate estimate after approved nonrefundable credits
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Calculation scopeConfirm approved ordinary resident inputs and the regular schedule election

Illustrative defaults. Enter approved taxable amounts and confirm eligibility. The result covers the displayed worksheet conditions; a complete return may require other income, adjustments, deductions or credits.

Act 2, approved May 6, 2026, applies the 3.7% top rate to tax year 2026. Reviewed October 2, 2026. This continuous marginal-rate estimate uses the enacted band ceilings and bracket adjustments; it does not reproduce a final return lookup table or select the low-income alternative. The published October 2025 estimated-tax worksheet still shows superseded 3.9% rates.

Reviewed October 12, 2026. Does Arkansas tax retirement income? Apply the enacted 2026 rate and owner exemptions

What Arkansas taxes in retirement

Partly taxed: limits by age, plan, owner or income apply. Military retirement is covered in the guide. How these labels work.

Arkansas retirement tax figures and sources

Arkansas exemptions and enacted 2026 rates for retirement income
RuleArkansas figureEffectivePrimary source
Social Security and Railroad Retirement benefitsExempt from Arkansas income taxContinuing; listed as exempt incomeArkansas DFA 2025 AR1000F instructions, page 10
Employer pensions, including disability retirementFirst $6,000 per recipient exempt, after any after-tax contributions are recoveredContinuingArkansas DFA 2025 AR1000F instructions
Traditional IRA distributionsShare that $6,000 once taken after age 59½, or on death or disability; early withdrawals for medical, education or first-home costs do not qualifyContinuingArkansas DFA 2025 AR1000F instructions
U.S. military retirement and survivor benefitsFully exempt; a retiree with less than $6,000 of it may exempt the difference from other retirement incomeExemption since 2018; offset rule for tax years 2023 and laterAct 358 of 2023
2026 rates, net income up to $94,7000% to $5,599 · 2% to $11,199 · 3% to $15,999 · 3.4% to $26,399 · 3.7% to $94,700Tax years beginning January 1, 2026; the act keeps these tables under the statute’s annual adjustmentAct 2 of 2026 (First Extraordinary Session)
2026 rates, net income above $94,700All of net income moves to a separate table: 2% of the first $4,700 plus 3.7% of every dollar past it. Act 2 then subtracts $290 at $94,701, a reduction that falls $10 with each $100 band and is gone once net income tops $97,600Tax years beginning January 1, 2026Act 2 of 2026 (First Extraordinary Session)
Standard deduction$2,470 per filer; $4,940 married filing jointly2025 returns, the latest published instructionsArkansas DFA 2025 AR1000F instructions

Does Arkansas tax retirement income? Apply the enacted 2026 rate and owner exemptions

Estimate Arkansas retirement tax using the enacted 2026 3.7% top rate, owner pension / IRA allowances and military exemptions. Compare joint and separate columns.

Arkansas excludes Social Security and qualified railroad retirement benefits from state income. Eligible employment-related retirement income and qualifying IRA distributions share a $6,000 allowance for each recipient. IRA distributions qualify after age 59½ at distribution, or under the state’s death / disability conditions. Federal exceptions for medical expenses, education or a first home do not automatically qualify. Recover contribution basis before identifying the amount eligible for the Arkansas allowance.

Qualifying uniformed-service retirement and retirement-funded survivor benefits are fully exempt. Act 358 of 2023 resolves the interaction with the ordinary allowance: military benefits below $6,000 leave only the difference available for eligible pension / IRA income. A $3,000 military pension plus $45,000 eligible plans therefore excludes $6,000, not $9,000. At $6,000 or more of military retirement, no additional ordinary plan allowance remains for that owner. Apply the rule separately to a spouse; unused room cannot be transferred.

Act 2, approved May 6, 2026, reduces the top individual rate to 3.7% for the entire 2026 tax year. For taxable income no greater than $94,700, enacted rates are 0%, 2%, 3%, 3.4% and 3.7%. Above $94,700, the upper schedule taxes the first $4,700 at 2% and the remainder at 3.7%. The statutory adjustment is $290 for $94,701–$94,800, falling $10 per $100 band through $97,501–$97,600; above that range it is zero. A withdrawal near those thresholds can cost more than a simple 3.7% multiplication suggests.

The worksheet starts with prepared Arkansas income after other state modifications and contribution basis, before the displayed retirement exclusions. Already-exempt Social Security and railroad benefits stay outside that base. Married joint filing pools the approved owner amounts for one rate calculation; married filing separately on the same return calculates each owner’s column independently. Prepare deductions for the chosen method. A separate-column result is not an automatic recommendation: credit eligibility and the complete return can affect the choice.

An approved joint illustration uses your $60,000 prepared income, including $45,000 eligible plans and $3,000 military retirement, plus your spouse’s $10,000 income with $5,000 eligible plans. Exclusions are $6,000 and $5,000, leaving $59,000 adjusted state income. Approved deductions totaling $4,940 leave $54,060 taxable. The continuous statutory rate estimate is $1,633.06 before credits, or $1,575.06 after an approved $58 nonrefundable credit. Separately approved columns with $2,470 deductions each produce a rate estimate of $1,539.45 before credits.

This is a continuous marginal-rate estimate using the enacted band ceilings, with cent rounding per separate column and the literal upper-income adjustment. It does not reproduce a final 2026 return lookup table, select the low-income alternative or prepare special lump-sum taxation. The published estimated-tax worksheet revised in October 2025 still shows superseded 3.9% rates and an older adjustment range; those rates are not used here. Choose a prepared liability in the federal worksheet when your return falls outside the confirmed regular-schedule conditions. Withholding and estimated payments belong in settlement, not nonrefundable credits.

Prepare these Arkansas records

Official Arkansas source. Enacted 2026 extraordinary-session Act 2; military interaction in Act 358 (2023); continuing eligibility and filing methods in published 2025 resident instructions.

Calculate the federal portion separately

Use the federal retirement-tax worksheet to prepare federally included benefits and ordinary income. Its federal deduction and rates do not replace the Arkansas rules above.

Compare Arkansas with nearby states

Missouri, Tennessee, Mississippi, Louisiana, Texas and Oklahoma border Arkansas. Run each one’s worksheet with the same household figures before deciding where a move would leave you.

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Updated / verified · Retirement Income Tax Calculator Editorial Team