Arkansas

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In a decision dated January 18, 2022, the Arkansas Office of Hearings and Appeals (OHA) held that a married couple remained domiciled in and residents of Arkansas for individual income tax purposes for the 2013 through 2018 tax years, rejecting the couple’s assertion that they had abandoned their Arkansas domicile by relocating to another state.…

On September 20th, the Los Angeles County Superior Court held that local video service provider fees do not apply to streaming video providers. This decision is consistent with a prior decision by the United States District Court for the District of Nevada, which held that streaming video providers were not subject to Nevada localities’ franchise…

The Revenue Legal Counsel division of the Arkansas Department of Finance and Administration published a Revenue Legal Opinion on May 6, 2021 (dated March 25, 2021) determining that cloud-based software that allows customers to monitor and prioritize the usage of internet bandwidth is not taxable. The taxpayer sells a cloud-based service (Saas) that customers purchase…

On March 17, 2021, Arkansas introduced S.B. 558, which would impose Arkansas sales tax on advertising revenue from social-media platforms that have annual gross revenue from social-media advertising services in Arkansas of at least $500,000. The bill amends the sales tax statute to include a new subchapter imposing a 7% sales tax on a…

The Arkansas Supreme Court held that a furniture and electronics retailer’s weekly and semi-monthly rent-to-own leases are subject to the excise tax on short-term – less than 30 days – rentals of tangible personal property. Under the retailer’s rental-purchase agreements, customers select an initial rental term of monthly, semi-monthly, or weekly. At the end of…

In Opinion No. 20190925, the Arkansas Department of Finance and Administration explained how the state would tax a proposed online peer-to-peer vehicle sharing platform. The opinion noted that the peer-to-peer platform in question would be considered a marketplace facilitator and discussed how local taxes will be sourced. But the Department declined to opine on…

The Arkansas Department of Finance & Administration issued an opinion stating that the provision of certain “virtual services,” including bookkeeping, project management, business analysis, email management, research, and customer service, provided via the Internet, are not subject to Arkansas sales tax. Arkansas sales tax is imposed on the gross proceeds from all sales of tangible…

On April 1, 2019, the Arkansas Office of Hearings and Appeals held that a taxpayer could not deduct interest expense for long-term debt used to finance a cash dividend as a non-business expense allocable to Arkansas because there was no corresponding non-business income allocable to the state.

The taxpayer was a corporation based in Arkansas…

On June 13, 2018, an Arkansas Administrative Law Judge concluded that a taxpayer’s proceeds from dispositions of tax credits were apportionable business income. In Arkansas, business income arises from either: (1) transactions and activity in the regular course of the taxpayer’s business (the transactional test); or (2) income from the acquisition, management and disposition of…