How Arkansas compares
Ranked against the other 49 states on the figures we hold. Rates that combine state and local components — sales tax, the minimum wage where it varies by region — are shown on this page but not ranked, because a single number would misstate them.
| Figure | AR | Nationally | In its region |
|---|---|---|---|
| PopulationUS Census Bureau, Vintage 2025 estimates, July 1, 2025 | 3,114,791 | 33rd highest of 50 | 10 of 12 |
| GDP ($bn)Bureau of Economic Analysis, 2025 | 198.4 | 34th highest of 50 | 10 of 12 |
| Median household incomeUS Census Bureau, ACS 2024 1-year, 2024 | $62,106 | 47th highest of 50 | 9 of 12 |
| Unemployment rateBureau of Labor Statistics, LAUS (seasonally adjusted, preliminary), September 2026 | 3.9% | tied 26th lowest of 50 | 7 of 12 |
| Foreign-born shareUS Census Bureau, ACS 2024 1-year, 2024 | 5.8% | 36th highest of 50 | 7 of 12 |
| Property tax ratechecked Nov 2026; confirm with the Arkansas legislature | 0.62% | 13th lowest of 50 | 6 of 12 |
| Deposit return window (days)checked Nov 2026; confirm with the Arkansas legislature | 60 | 50th lowest of 50 | 12 of 12 |
| Eviction notice (days)checked Nov 2026; confirm with the Arkansas legislature | 3 | tied 31st highest of 50 | 9 of 12 |
- State income tax: yes41 of 50 states answer the same way
- At-will employment: yesthe same in all 50 states — it does not set Arkansas apart
- Paid sick leave required: no30 of 50 states answer the same way
- Paid family leave: no38 of 50 states answer the same way
- Workers' comp required: yes49 of 50 states answer the same way
- Rent control permitted: no46 of 50 states answer the same way
- Annual report required: yes43 of 50 states answer the same way
Statistical figures: US Census Bureau, Vintage 2025 estimates (July 1, 2025) · US Census Bureau, ACS 2024 1-year (2024) · Bureau of Economic Analysis (2025) · Bureau of Labor Statistics, LAUS (seasonally adjusted, preliminary) (September 2026) · SBA Office of Advocacy, 2025 Small Business Profiles (2025). Tax, wage, business and tenancy figures are recorded from state sources and were last checked on 2026-11-05 — confirm anything you are about to act on with the Arkansas legislature.
What's changing in Arkansas
Enacted changes with a fixed effective date. Contracts, payroll and leases signed now may run past these dates.
Coming up
- January 1, 2027Top corporate income tax rate falls to 4.1%Source ↗
Took effect in the last 12 months
- January 1, 2026Top income tax rate cut to 3.7% (from 3.9%)
Enacted in the May 2026 special session, retroactive to January 1, 2026.
Source ↗
Checked against official sources on 2026-11-05.
How long you have in Arkansas
The periods that decide whether something is on time. Days are calendar days unless the underlying rule says otherwise.
- Return a security deposit within
- 60 days
- Eviction notice before filing
- 3 days
- LLC formation processed in
- 3–5 days
- Overtime starts after
- 40 hrs/week
AI Legal Insights — Arkansas
AI-generated · Updated July 2026
Arkansas operates under a dual court system consisting of state and federal jurisdictions, with the Arkansas Supreme Court serving as the highest judicial authority. The state follows common law principles and has specific statutes governing consumer protections and landlord-tenant relations that businesses must strictly observe.
The business climate is characterized by a low tax burden and a<pad><pad><pad><pad><pad><pad><pad><pad><pad><pad> de-regulated environment, making it attractive for manufacturing and logistics. While the state offers competitive income tax rates, businesses must navigate local sales tax variations that are added to the 6.5% state base.
Arkansas has a relatively small foreign-born population of 4.8%, with immigrant communities often concentrated in Northwest Arkansas and the Little Rock metropolitan area. The state does not have sanctuary city policies, and immigration matters are primarily handled through federal USCIS offices in the region.
- ›Ensure all real estate contracts comply with the Arkansas Statute of Frauds, requiring written documentation for land transfers.
- ›Include a clear choice-of-law provision specifying Arkansas law to avoid jurisdictional uncertainty in local litigation.
- ›Be mindful of the Arkansas Uniform Commercial Code (UCC) when drafting agreements involving the sale of goods.
AI-generated insights · Verify with a licensed attorney before relying on this information.
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Employment Laws
Arkansas labor regulations
Arkansas is an at-will, right-to-work state. The state minimum wage has been $11.00/hr since January 1, 2021, for employers with four or more employees, and no further increase is scheduled. There is no state mandate for paid sick leave or paid family leave. Workers' compensation is required once an employer has three or more employees. Beyond these rules, Arkansas largely follows federal employment standards.
| Law | AR Rule | Federal Floor |
|---|---|---|
| Minimum Wage | $11.00/hr since Jan 1, 2021 (employers with 4+ employees) | $7.25/hr |
| Overtime | After 40 hrs/week at 1.5× rate (follows FLSA) | FLSA: after 40 hrs/week |
| Paid Sick Leave | No state mandate | None (federal) |
| Paid Family Leave | No state program | FMLA: 12 weeks unpaid |
| Workers Comp | Required for employers with 3+ employees | Federal employees: yes |
| At-Will Employment | Yes; narrow public-policy exceptions | Default nationwide |
| Right to Work | Union membership or dues cannot be a condition of employment | NLRA allows states to adopt right-to-work laws |
| Final Paycheck | Generally due by the next regular payday after separation | No federal deadline |
| Meal & Rest Breaks | No requirement for adults; child labor rules apply to minors | No federal requirement |
- Arkansas has been a right-to-work state since 1944 — employees cannot be required to join a union or pay union dues.
- The $11.00 minimum wage was set by a 2018 voter-approved ballot measure; it applies to employers with four or more employees.
- Workers' compensation is required for employers with 3 or more employees — a lower threshold than many states.
- The Arkansas Civil Rights Act prohibits employment discrimination based on race, religion, national origin, gender, and disability for employers with 9 or more employees.
- Arkansas has no state WARN Act; only the federal 60-day notice rule for qualifying plant closings and mass layoffs applies.
- Arkansas has no paid sick leave or paid family leave law; eligible employees may take unpaid leave under the federal FMLA.
Sources: U.S. Department of Labor state minimum wage table · state labor agencies (checked Nov 2026)
Landlord-Tenant Laws
Arkansas rental regulations
Arkansas is one of the most landlord-friendly states. Security deposits are capped at two months' rent for most landlords, and landlords have 60 days to return deposits — a longer window than most states. A 2021 law added basic minimum habitability standards, but tenant remedies remain limited. Eviction for non-payment starts with a 3-day notice to vacate, and there is no rent control in Arkansas.
| Topic | AR Rule |
|---|---|
| Security Deposit | Capped at 2 months' rent; landlords who own five or fewer rental units (and do not use a management company) are exempt from the deposit rules |
| Deposit Return | Within 60 days after the tenancy ends, with an itemized written list of deductions |
| Wrongful Withholding | A landlord who wrongfully withholds a deposit can owe the tenant up to twice the amount withheld |
| Rent Control | No rent control anywhere in Arkansas |
| Eviction Notice (Non-Payment) | 3-day written notice to vacate before the landlord can file an unlawful detainer case |
| Eviction Court Process | After the case is filed and served, the tenant has a short deadline to file an objection; otherwise the court can issue a writ of possession |
| Habitability | Since 2021, landlords must meet basic minimum standards such as working sewage disposal, running water, electricity, and heat; remedies are more limited than in most states |
| Landlord Entry | No general statutory notice requirement; entry terms are usually set by the lease |
Both landlords and tenants have enforceable rights under Arkansas law. Document all communications and keep copies of your lease agreement. Use AI review to spot risky clauses before signing.
Starting a Business
Arkansas LLC formation guide
Arkansas is one of the most affordable states to start a business, with an LLC filing fee of just $45. LLCs pay a $150 annual franchise tax with their annual report, due May 1. Corporate income tax rates run from 1% to 4.3% in 2026, and the top rate falls to 4.1% in 2027. Home to Walmart and Tyson Foods, Arkansas has a strong retail, food processing, and logistics base.
Step-by-step LLC formation
- 1Choose a business name
Name must include "LLC" or "Limited Liability Company"; verify availability with the Arkansas Secretary of State
sos.arkansas.gov - 2File Articles of Organization$45
Submit to the Arkansas Secretary of State online or by mail; $45 filing fee
sos.arkansas.gov - 3Designate a registered agent
Must maintain a physical Arkansas address; can be an individual resident or a commercial registered agent
- 4Obtain an EIN from the IRS
Free at irs.gov; required for banking, hiring employees, and state tax filings
- 5Register for Arkansas taxes
Register with the Arkansas Department of Finance and Administration for sales tax, withholding tax, and income tax as applicable
dfa.arkansas.gov - 6File annual franchise tax report$150
LLCs file an annual franchise tax report and pay $150 by May 1 each year
- 7Obtain local business licenses
Check with your city or county for any required local business licenses or permits
Every LLC also needs a free EIN from the IRS (Form SS-4). Apply online at irs.gov — takes about 15 minutes and is required to open a business bank account.
Popular IRS Forms
Most-filed federal forms for Arkansas taxpayers
Fill these out online with plain-English guidance — every field explained, no accountant required. Download as a ready-to-file PDF when done.
The main annual federal income tax return every taxpayer files.
Fill out free →Give your SSN or EIN to a client before getting paid as a contractor.
Fill out free →Report $600+ paid to independent contractors during the year.
Fill out free →Tell your employer how much federal tax to withhold from pay.
Fill out free →Report income and expenses from a sole proprietorship or LLC.
Fill out free →Report payroll taxes withheld from employees each quarter.
Fill out free →Get an automatic 6-month extension to file your 1040.
Fill out free →The year-end wage statement employers issue to each employee.
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Federal Offices
United States government offices in Arkansas
Walk-in assistance by appointment only. Call (844) 545-5640 to schedule, or book online at irs.gov.
Free Legal Aid
Arkansas legal assistance organizations
These organizations provide free or reduced-cost civil legal services to qualifying Arkansas residents.
Before your consultation: upload your document for a free AI risk scan — understand the key issues before meeting an attorney.
Free AI contract review →Latest Tax & Business News
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