Arkansas payroll calculator and employer taxes (2026)

Arkansas payroll in 2026: the changes and the catches

A mid-year withholding fix

The Department of Finance and Administration first posted a 2026 withholding formula with a 3.90% top rate. HB 1001 replaced it with a 3.70% top rate, retroactive to January 1, 2026, and the revised formula (posted 05/29/2026) uses a $2,470 standard deduction and brackets from 0% to 3.70%. If your payroll software kept the old formula into the spring, some employees were over-withheld, so check the date your provider switched.

The smallest wage base in our data

Arkansas taxes unemployment on $7,000 per worker, the same as the federal FUTA base and tied for the lowest in our 2026 SUTA comparison. The state's rate range is 0.200% to 5.100%, with deficit levels of 6.100%, 8.100% and 10.100%. A 0.200% stabilization rate also applies; DWS does not say whether the 2.0% new employer rate already includes it.

Discharged workers are paid the same day

Wages are due on the day of discharge. If you have not paid within 7 days of the employee asking, wages keep running for up to 60 days (Ark. Code 11-4-405, read from a secondary reproduction of the statute). Our source did not address quits.

Smaller rules

• Minimum wage is $11.00 for employers with 4 or more employees; the tipped cash wage is $2.63. Rates for neighbors such as Tennessee and Missouri are in the state minimum wage list.
• Workers comp is required from 3 employees for most employers.
• Pay at least semi-monthly (US Department of Labor payday table).
• We found no state paid leave program and no local income taxes, though neither was confirmed on a state page.

Arkansas employer payroll facts at a glance

Getting an Arkansas employer account

1. Get a federal EIN.
2. Register for withholding with the DFA Withholding Tax Branch, and use the formula posted 05/29/2026.
3. Open an unemployment account with DWS. Its Tax 21 Employer Portal is linked from the DWS employer UI page; DWS stops short of saying new accounts are opened in that portal, so call DWS if no new-account option appears.
4. Send new hire and rehire reports to the DWS New Hire Reporting Center inside 20 days.
5. Buy workers comp once you have 3 employees. Arkansas has no monopolistic state fund.

The first hire checklist lists the federal forms that go with these steps.

Arkansas example: employer taxes on $50,000

With a $7,000 base, Arkansas unemployment tax on a new hire is close to the FUTA line.

That is $4,007, 8.01% over salary. If the stabilization rate turns out to be billed on top, add 0.200% x $7,000 = $14, for $4,021. Even the highest regular rate, 5.100%, costs $357 per worker. Put your own salary and rate into the calculator below.

Choosing Arkansas payroll help

The detail to check in Arkansas is withholding accuracy after HB 1001: ask any provider which formula it used for January to May 2026 payrolls. Published prices to start from: Gusto Simple at $49 a month plus $6 per person, OnPay at $49 plus $6 per worker, and Patriot Full Service at $37 plus $5 per worker paid (all checked October 16, 2026). See our payroll software rankings and the cheapest options in free and low-cost payroll software.

Arkansas appears on Harbor Compliance's list of PEO licensing states. That is a private compilation, and no Arkansas agency page confirmed it for us. If you want benefits and workers comp in one invoice, start with the best PEOs.