Browse Arkansas Code titles and sections
26-51-307. Retirement or disability benefits — Definition.
Arkansas Code — all titles (historical 2020) · legal_authorities
26-51-307. Retirement or disability benefits — Definition.
(a)(1) The first six thousand dollars ($6,000) of benefits received by a resident of this state from an individual retirement account or the first six thousand dollars ($6,000) of retirement benefits received by a resident of this state from public or private employment-related retirement systems, plans, or programs, regardless of the method of funding for these systems, plans, or programs, is exempt from the state income tax.
(2)(A) Only individual retirement account benefits received by an individual retirement account participant after reaching fifty-nine and one-half (59½) years of age qualify for the exemption.
(B) The only other distributions or withdrawals from an individual retirement account that qualify for the exemption before the individual retirement account participant reaches fifty-nine and one-half (59½) years of age are those made on account of the participant's death or disability.
(C) All other premature distributions or early withdrawals, including without limitation those taken for medical-related expenses, higher education expenses, or a first-time home purchase, do not qualify for the exemption.
(b)(1)(A) Except as provided in subdivision (b)(2) of this section and subsection (e) of this section, the exemption provided for in subsection (a) of this section for benefits received from an individual retirement account or from a public or private employment-related retirement system, plan, or program is the only exemption from the state income tax allowed for benefits received from an individual retirement account or from any publicly or privately supported employment-related retirement system, plan, or program, excepting only benefits received under systems, plans, or programs which
Source: Arkansas Code — historical release 78 (November 6, 2020) · 26-51-307
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. A text match is a research starting point; applicability is not established.
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Stable record: arkansas_code:legal_authorities:26-51-307
Source file: gov.ar.code.title.26.odt
Pages: Not recorded – Not recorded
Passage SHA-256: f30303f402aed7de9adb708be7c7399162624a14363eeee435979b7b2c46d4ce
Source location: content.xml paragraph 11808
Stored source content
26-51-307. Retirement or disability benefits — Definition.
(a)(1) The first six thousand dollars ($6,000) of benefits received by a resident of this state from an individual retirement account or the first six thousand dollars ($6,000) of retirement benefits received by a resident of this state from public or private employment-related retirement systems, plans, or programs, regardless of the method of funding for these systems, plans, or programs, is exempt from the state income tax.
(2)(A) Only individual retirement account benefits received by an individual retirement account participant after reaching fifty-nine and one-half (59½) years of age qualify for the exemption.
(B) The only other distributions or withdrawals from an individual retirement account that qualify for the exemption before the individual retirement account participant reaches fifty-nine and one-half (59½) years of age are those made on account of the participant's death or disability.
(C) All other premature distributions or early withdrawals, including without limitation those taken for medical-related expenses, higher education expenses, or a first-time home purchase, do not qualify for the exemption.
(b)(1)(A) Except as provided in subdivision (b)(2) of this section and subsection (e) of this section, the exemption provided for in subsection (a) of this section for benefits received from an individual retirement account or from a public or private employment-related retirement system, plan, or program is the only exemption from the state income tax allowed for benefits received from an individual retirement account or from any publicly or privately supported employment-related retirement system, plan, or program, excepting only benefits received under systems, plans, or programs which are by federal law exempt from the state income tax.
(B) Except as provided in subsection (e) of this section, a taxpayer shall not receive an exemption greater than six thousand dollars ($6,000) during any tax year under this section.
(2) This section does not apply to retirement or disability benefits received under a plan, system, or fund described in § 26-51-404(b)(6).
(c)(1) Title 26 U.S.C. § 72, as in effect on January 1, 2009, is the sole method by which a recipient of benefits from an individual retirement account or from public or private employment-related retirement systems, plans, or programs may deduct or recover his or her cost of contribution to the plan when computing his or her income for state income tax purposes.
(2) A taxpayer shall not deduct or recover any portion of the taxpayer's cost of contribution to the plan that the taxpayer:
(A) Has already deducted or recovered; or
(B) Would have been allowed to deduct or recover under any provision of law or court decision.
(d)(1) An individual who is sixty-five (65) years of age or older and who does not claim an exemption under subsection (a) of this section is entitled to an additional state income tax credit of twenty dollars ($20.00).
(2) This credit is in addition to all other credits allowed by law.
(e)(1) The following are exempt from the income tax imposed under this chapter:
(A) Retirement benefits received by a member of the uniformed services from any of the uniformed services identified in subdivision (e)(2) of this section; and
(B) Survivor benefits that are funded by the retirement pay of a member of the uniformed services.
(2) As used in this subsection, “member of the uniformed services” means a retired member of any of the following:
(A) The United States Army, the United States Marine Corps, the United States Navy, the United States Air Force, or the United States Coast Guard;
(B) A reserve component of any of the United States Armed Forces listed in subdivision (e)(2)(A) of this section;
(C) The National Guard of any state;
(D) The commissioned regular or reserve corps of the United States Public Health Service; or
(E) The National Oceanic and Atmospheric Administration Commissioned Officer Corps.
(f) A taxpayer claiming an exemption under subsection (e) of this section is not eligible for an exemption under subsection (a) of this section.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rules for annuities**
(1) **Income inclusion** — Except as otherwise provided in this chapter, gross income includes any amount received as an annuity (whether for a period certain or during one or more lives) under an annuity, endowment, or life insurance contract.
(2) **Partial annuitization** — If any amount is received as an annuity for a period of 10 years or more or during one or more lives under any portion of an annuity, endowment, or life insurance contract—
(A) such portion shall be treated as a separate contract for purposes of this section,
(B) for purposes of applying subsections (b), (c), and (e), the investment in the contract shall be allocated pro rata between each portion of the contract from which amounts are received as an annuity and the portion of the contract from which amounts are not received as an annuity, and
(C) a separate annuity starting date under subsection (c)(4) shall be determined with respect to each portion of the contract from which amounts are received as an annuity.
**(b) Exclusion ratio**
(1) **In general** — Gross income does not include that part of any amount received as an annuity under an annuity, endowment, or life insurance contract which bears the same ratio to such amount as the investment in the contract (as of the annuity starting date) bears to the expected return under the contract (as of such date).
(2) **Exclusion limited to investment** — The portion of any amount received as an annuity which is excluded from gross income under paragraph (1) shall not exceed the unrecovered investment in the contract immediately before the receipt of such amount.
(3) **Deduction where annuity payments cease before entire investment recovered**
(A) *In general* — If—
(i) after the annuity starti
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 72
Stored review status: release_metadata_unconfirmed. The source passage cites 26 U.S.C. § 72. This identifies an authority to review, not proof of applicability.
Federal law — U.S. Code and appendices · legal_authorities
Page 462
TITLE 26—INTERNAL REVENUE CODE
[§ 71
1 Section catchline amended by Pub. L. 115–97 without cor-
responding amendment of analysis.
tion [amending this section] shall apply to taxable
years beginning after December 31, 2005.’’
EFFECTIVE DATE OF 1998 AMENDMENT
Pub. L. 105–277, div. J, title IV, § 4004(c)(3), Oct. 21,
1998, 112 Stat. 2681–911, provided that: ‘‘The amendment
made by subsection (b)(2) [amending this section] shall
apply to taxable years beginning after December 31,
1990.’’
EFFECTIVE DATE OF 1993 AMENDMENT
Amendment by section 13201(b)(3)(E) of Pub. L. 103–66
applicable to taxable years beginning after Dec. 31,
1992, see section 13201(c) of Pub. L. 103–66, set out as a
note under section 1 of this title.
EFFECTIVE DATE
Section applicable to taxable years beginning after
Dec. 31, 1990, see section 11103(e) of Pub. L. 101–508, set
out as an Effective Date of 1990 Amendment note under
section 1 of this title.
PART II—ITEMS SPECIFICALLY INCLUDED
IN GROSS INCOME
Sec.
[71.
Repealed.]
72.
Annuities; certain proceeds of endowment
and life insurance contracts.
73.
Services of child.
74.
Prizes and awards.
75.
Dealers in tax-exempt securities.
[76.
Repealed.]
77.
Commodity credit loans.
78.
Dividends received from certain foreign cor-
porations by domestic corporations choos-
ing foreign tax credit.1
79.
Group-term life insurance purchased for em-
ployees.
80.
Restoration of value of certain securities.
[81.
Repealed.]
82.
Reimbursement of moving expenses.
83.
Property transferred in connection with per-
formance of services.
84.
Transfer of appreciated property to political
organizations.
85.
Unemployment compensation.
86.
Social security and tier 1 railroad retirement
benefits.
87.
Alcohol and biodiesel fue
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 72
Stored review status: historical_2024_not_currentness_verified. The source passage cites 26 U.S.C. § 72. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
26-51-404. Gross income generally.
(a)(1) “Gross income” includes:
(A) Gains, profits, and income derived from salaries, wages, or compensation for personal service of whatever kind and in whatever form paid;
(B) Gains, profits, and income derived from professions, vocations, trades, business, commerce, or sales;
(C) Gains, profits, and income derived from dealings in property, whether real or personal, growing out of the ownership of, use of, or interest in the property;
(D) Gains, profits, and income derived from interest, rent, royalties, dividends, annuities, securities, or the transaction of any business carried on for gain or profit;
(E) Gains or profits and income derived from any source whatever;
(F) Any payments of alimony and separate maintenance received pursuant to a court order;
(G) Unemployment compensation benefits paid from federal unemployment funds; and
(H) Unemployment insurance benefits received from unemployment compensation paid under Title IV of the Social Security Act, 42 U.S.C. § 601 et seq., except for unemployment or sickness payments made pursuant to 45 U.S.C. § 352, as it existed on January 1, 2017.
(2) The amount of all such items shall be included in the gross income of the taxable year in which received by the taxpayer.
(3) Any recovery of an amount which was deducted from gross income in a prior year must be treated as taxable income in the year recovered to the extent that the deduction resulted in a reduction in income tax liability.
(4) Title 26 U.S.C. § 117, as in effect on January 2, 2017, regarding the taxability of scholarships, fellowships, grants, and stipends, is adopted for the purpose of clarifying and calculating Arkansas income tax liability.
(b) “Gross income” does not include the following items,
Source: Arkansas Code — historical release 78 (November 6, 2020) · 26-51-404
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 26-51-404. This identifies an authority to review, not proof of applicability.