Arkansas Code of 1987 (2023) › Title 26 - TAXATION (§§ 26-1-101 — 26-82-119) › Subtitle 5 - STATE TAXES (§§ 26-50-101 — 26-65-108) › Chapter 51 - INCOME TAXES (§§ 26-51-101 — 26-51-2804) › Subchapter 2 - IMPOSITION OF TAX (§§ 26-51-201 — 26-51-207) › Section 26-51-205 - Corporations - Work Force 2000 Development Fund

(a)
(1)
Every corporation organized under the laws of this state shall pay annually an income tax with respect to carrying on or doing business on the entire net income of the corporation, as now defined by the laws of the State of Arkansas, received by the corporation during the income year, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the second three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%);
(E)
On the next seventy-five thousand dollars ($75,000) of net income or any part thereof, but not exceeding one hundred thousand dollars ($100,000), six percent (6%); and
(F)
On net income exceeding one hundred thousand dollars ($100,000), six and five-tenths percent (6.5%).
(2)
For the tax year beginning January 1, 2021, every corporation organized under the laws of this state shall pay annually an income tax with respect to carrying on or doing business on the entire net income of the corporation, as now defined by the laws of this state, received by the corporation during the income year, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%);
(E)
On the next seventy-five thousand dollars ($75,000) of net income or any part thereof, six percent (6%); and
(F)
On net income exceeding one hundred thousand dollars ($100,000), six and two-tenths percent (6.2%).
(3)
For tax years beginning on or after January 1, 2022, every corporation organized under the laws of this state shall pay annually an income tax with respect to carrying on or doing business on the entire net income of the corporation, as now defined by the laws of this state, received by the corporation during the income year, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%); and
(E)
On net income exceeding twenty-five thousand dollars ($25,000), five and nine-tenths percent (5.9%).
(4)
For tax years beginning on or after January 1, 2023, every corporation organized under the laws of this state shall pay annually an income tax with respect to carrying on or doing business on the entire net income of the corporation, as now defined by the laws of this state, received by the corporation during the income year, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%); and
(E)
On net income exceeding twenty-five thousand dollars ($25,000), five and one-tenths percent (5.1%).
(5)
For tax years beginning on or after January 1, 2024, every corporation organized under the laws of this state shall pay annually an income tax with respect to carrying on or doing business on the entire net income of the corporation, as now defined by the laws of this state, received by the corporation during the income year, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%); and
(D)
On net income exceeding eleven thousand dollars ($11,000), four and three-tenths percent (4.3%).
(b)
(1)
Every foreign corporation doing business within the jurisdiction of this state shall pay annually an income tax on the proportion of its entire net income as now determined by the income tax laws of this state, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the second three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%);
(E)
On the next seventy-five thousand dollars ($75,000) of net income or any part thereof, but not exceeding one hundred thousand dollars ($100,000), six percent (6%); and
(F)
On net income exceeding one hundred thousand dollars ($100,000), six and five-tenths percent (6.5%).
(2)
For the tax year beginning January 1, 2021, every foreign corporation doing business within the jurisdiction of this state shall pay annually an income tax on the proportion of its entire net income as now determined by the income tax laws of this state, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%);
(E)
On the next seventy-five thousand dollars ($75,000) of net income or any part thereof, six percent (6%); and
(F)
On net income exceeding one hundred thousand dollars ($100,000), six and two-tenths percent (6.2%).
(3)
For tax years beginning on or after January 1, 2022, every foreign corporation doing business within the jurisdiction of this state shall pay annually an income tax on the proportion of its entire net income as now determined by the income tax laws of this state, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%); and
(E)
On net income exceeding twenty-five thousand dollars ($25,000), five and nine-tenths percent (5.9%).
(4)
For tax years beginning on or after January 1, 2023, every foreign corporation doing business within the jurisdiction of this state shall pay annually an income tax on the proportion of its entire net income as now defined by the income tax laws of this state, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%);
(D)
On the next fourteen thousand dollars ($14,000) of net income or any part thereof, five percent (5%); and
(E)
On net income exceeding twenty-five thousand dollars ($25,000), five and one-tenths percent (5.1%).
(5)
For tax years beginning on or after January 1, 2024, every foreign corporation doing business within the jurisdiction of this state shall pay annually an income tax on the proportion of its entire net income as now defined by the income tax laws of this state, on the following basis:
(A)
On the first three thousand dollars ($3,000) of net income or any part thereof, one percent (1%);
(B)
On the next three thousand dollars ($3,000) of net income or any part thereof, two percent (2%);
(C)
On the next five thousand dollars ($5,000) of net income or any part thereof, three percent (3%); and
(D)
On net income exceeding eleven thousand dollars ($11,000), four and three-tenths percent (4.3%).
(c)
(1)
(A)
There is created on the books of the Treasurer of State, the Auditor of State, and the Chief Fiscal Officer of the State a fund to be known as the "Work Force 2000 Development Fund".
(B)
The Work Force 2000 Development Fund shall consist of those special revenues as specified in subdivision (c)(2) of this section and all other revenues as may be authorized by law.
(2)
(A)
The Revenue Division of the Department of Finance and Administration shall deposit the funds collected under the provisions of this section for corporate income tax into the State Treasury, there to be credited to the Revenue Holding Fund Account of the State Apportionment Fund.
(B)
(i)
(a)
For each of the state's fiscal years, the Chief Fiscal Officer of the State shall determine as an annual allocation available under the provisions of this section an amount based on the total net revenues, as enumerated in subsections (a) and (b) of this section, which were collected in the immediate past year, multiplied by a factor of six hundred seventy-eight ten thousandths (.0678).
(b)
On the last day of each month of the respective fiscal year, the Chief Fiscal Officer of the State shall certify to the Treasurer of State an amount based on one-twelfth (
1
/
12
) of the annual allocation provided in this section for transfer as specified in subdivision (c)(2)(B)(ii) of this section.
(ii)
The Treasurer of State shall then transfer the amount so certified to the Special Revenue Fund Account as part of the gross special revenues.
(iii)
After the deductions as set out in §
19-5-203
have been made, the remaining amount shall be credited to the Work Force 2000 Development Fund.
(iv)
The remaining corporate income tax collections remaining in the Revenue Holding Fund Account shall be credited to the General Revenue Fund Account of the State Apportionment Fund, there to be distributed with the other gross general revenue collections for that month in accordance with the provisions of §
19-5-201
et seq.
(d)
(1)
All proceeds derived from the additional tax levied by this section shall be used exclusively for the authorized educational activities of:
(A)
Any postsecondary vocational-technical school, technical institute, comprehensive lifelong learning center, technical college, community college; or
(B)
Any postsecondary vocational-technical school, technical institute, comprehensive lifelong learning center, or technical college that merges with a two-year branch of a four-year institution, a four-year institution, a technical college, or a community college.
(2)
(A)
The distribution of the proceeds shall be supervised by the Career Education and Workforce Development Board for the postsecondary vocational-technical schools, technical institutes, and comprehensive lifelong learning centers.
(B)
The distribution of the proceeds for technical colleges, community colleges, or any postsecondary vocational-technical school, technical institute, comprehensive lifelong learning center, or technical college that merges with a two-year branch of a four-year institution, a four-year institution, a technical college, or a community college shall continue at the same proportion as those distributions made in fiscal year 1996-1997, excluding one-time capital disbursements and professional development disbursements made in fiscal year 1996-1997 equal to the amount of funds distributed in fiscal year 1998-1999.
(C)
Any increase in the amount of funds in the Work Force 2000 Development Fund above the amount distributed in fiscal year 1998-1999 shall be supervised by the Arkansas Higher Education Coordinating Board and shall be distributed after a review of needs including, but not limited to, equity considerations and workforce development and after consultation with the presidents and chancellors of the technical and former technical colleges.
(e)
(1)
(A)
After the amounts to be made available to the various technical institutes or comprehensive lifelong learning centers have been determined under subdivisions (d)(2)(A) and (d)(2)(B) of this section, such documents as may be necessary shall be processed so that funds may be transferred from the Work Force 2000 Development Fund to the State Treasury fund or fund account from which the technical institute or comprehensive lifelong learning center draws its general revenue support.
(B)
The amount of the funds transferred under subdivision (e)(1)(A) of this section shall not exceed six and three hundred nine thousandths percent (6.309%) of the total funds available from the Work Force 2000 Development Fund during each fiscal year.
(2)
If a technical college, community college, or educational institution that receives support from the Work Force 2000 Development Fund as determined by law transfers from the Arkansas Technical College and Community College system for which Work Force 2000 Development Fund moneys are determined by law, then the actual amount of support from the Work Force 2000 Development Fund in the preceding fiscal year for the transferring educational institution shall be made available regardless of any other provision of law that sets out maximum levels of support from such fund.
(3)
(A)
The funds distributed under subdivision (d)(2)(C) of this section in excess of those amounts collected and distributed before June 30, 2014, shall be deposited into the Skills Development Fund to be used only for personal services, grants, operation, support, and improvement of occupational, vocational, technical, and workforce development programs by the Office of Skills Development of the Department of Commerce.
(B)
The distributions of funds under subdivision (d)(2)(C) of this section in excess of those amounts collected and distributed before June 30, 2014, shall not apply to proceeds allocated to schools, colleges, and educational institutions under subdivisions (d)(2)(A) and (d)(2)(B) of this section.
Amended by Act 2024EX2, No. 4,§ 3, eff. 6/19/2024.
Amended by Act 2024EX2, No. 4,§ 2, eff. 6/19/2024.
Amended by Act 2024EX2, No. 1,§ 3, eff. 6/19/2024.
Amended by Act 2024EX2, No. 1,§ 2, eff. 6/19/2024.
Amended by Act 2023EX1, No. 6,§ 3, eff. 9/14/2023.
Amended by Act 2023EX1, No. 6,§ 2, eff. 9/14/2023.
Amended by Act 2023, No. 532,§ 4, eff. 8/1/2023.
Amended by Act 2023, No. 532,§ 3, eff. 8/1/2023.
Amended by Act 2023, No. 796,§ 71, eff. 7/1/2023.
Amended by Act 2022EX3, No. 2,§ 3, eff. effective for tax years beginning on or after January 1, 2023.
Amended by Act 2022EX3, No. 1,§ 3, eff. effective for tax years beginning on or after January 1, 2023.
Amended by Act 2022EX3, No. 2,§ 2, eff. effective for tax years beginning on or after January 1, 2023.
Amended by Act 2022EX3, No. 1,§ 2, eff. effective for tax years beginning on or after January 1, 2023.
Amended by Act 2021EX2, No. 2,§ 7, eff. for tax years beginning on or after January 1, 2022.
Amended by Act 2021EX2, No. 2,§ 6, eff. for tax years beginning on or after January 1, 2022.
Amended by Act 2021EX2, No. 1,§ 7, eff. for tax years beginning on or after January 1, 2022.
Amended by Act 2021EX2, No. 1,§ 6, eff. for tax years beginning on or after January 1, 2022.
Amended by Act 2019, No. 822,§ 4, eff. 1/1/2021.
Acts 1941, No. 129, § 2; 1969, No. 392, §§ 1, 2; A.S.A. 1947, § 84-2004; Acts 1991, No. 1052, §§ 1-4; 1997, No. 171, § 2; 1999, No. 1315, §§ 2, 3.