26 CAR pt. 100, Appendix A
26 CAR pt. 100, Appendix A. Individual Income Tax Regulations
Length: 5,090 wordsOfficial source
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
ADDITIONAL PENALTIES AND TAX
Failure to File and Failure to Pay Penalties
1.26-18-208(3)(B)
12
Underestimated Tax Penalty
1.26-18-208(6)(A)
12
ADOPTED INTERNAL REVENUE CODES
Alpha Listing
3
Numeric Listing
8
ANNUAL WITHHOLDING STATEMENT
Filing Requirement
1.26-51-909(a)
98
Filing Requirement -- Due Date
1.26-51-909(b)
98
ASSEMBLING YOUR ARKANSAS RETURN
2
CLAIMS FOR REFUNDS OF OVERPAYMENTS
Grounds for Refund Claim
1.26-18-507(a)
15
Form and Procedure for Refund Claims
1.26-18-507(i)(1)
15
Judicial Relief
1.26-18-507(e)(2)
15
COMPENSATION AND BENEFITS FROM MILITARY SERVICE
Exemption Amount
1.26-51-306
26
Combat Pay
1.26-51-306(a)(4)
27
Service Allowances
2.26-51-306
27
United States Armed Services Defined
3.26-51-306
27
COMPUTING CAPITAL GAINS AND LOSSES
Computing Capital Gains and Losses -- Generally
1.26-51-815(a)
91
Computation of Tax
1.26-51-815(b)
92
Exclusion of Small Business Stock from Gain
1.26-51-815(c)
94
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
NUMBER
PAGE
NUMBER
CONFIDENTIALITY OF REPORTS AND RETURNS
Confidentiality -- Generally
1.26-51-813
90
Confidentiality - Exceptions
2.26-51-813
90
CORPORATE LIQUIDATIONS
Amounts Distributed in Complete Liquidation
1.26-51-413
55
Stock Purchase Treated as Asset Acquisition
2.26-51-413
56
DATE OF PERFORMANCE
U.S. Postal Service Postmark
1.26-18-105(a)(2)
12
When Last Day is a Saturday, Sunday or Legal Holiday
1.26-18-105(b)
12
DEDUCTIONS - CHARITABLE CONTRIBUTIONS
Charitable Contributions
1.26-51-419
60
DEDUCTIONS - COLLEGE AND TECHNICAL
SCHOOL TUITION
1.26-51-447
76
DEDUCTIONS - DEPRECIATION; EXPENSING OF PROPERTY
Depreciation
1.26-51-428(a)
70
Amortization of Intangibles
1.26-51-428(c)
70
DEDUCTIONS - EXPENSES
Types of Deductions
1.26-51-423(a)
60
Long-Term Care Insurance Premiums (Business Expenses)
1.26-51-423(a)(1)
61
Long-Term Care Insurance Premiums (Medical Expenses)
1.26-51-423(a)(2)
61
Travel and Entertainment
1.26-51-423(b)
61
Medical Care Insurance Premiums (Business Expenses)
1.26-51-423(c)(1)
61
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
NUMBER
PAGE
NUMBER
DEDUCTIONS - LOSSES
Losses
1.26-51-424(a)(1)
62
Transfer of Property to Related Person
2.26-51-424(a)(1)
62
Voluntary Removal or Demolition
3.26-51-424(a)(1)
62
Obsolescence
4.26-51-424(a)(1)
63
Shrinkage in Value of Stock
5.26-51-424(a)(1)
63
Farm Losses
6.26-51-424(a)(1)
63
DEDUCTIONS -- NET OPERATING LOSS CARRYOVER
Net Operating Loss Carryover
1.26-51-427
65
Net Operating Loss Carryover - Adjustments
2.26-51-427
69
DEDUCTIONS -- PASSIVE ACTIVITY LOSS
1.26-51-436(2)
71
DEDUCTIONS - TAXES
State Income Taxes
1.26-51-416
60
DEDUCTIONS - WORTHLESS DEBTS
Worthless Debts
Mortgaged or Pledged Property Sold for Less
1.26-51-425
64
Than the Amount of the Debt
2.26-51-425
64
Bonds or Other Similar Obligations
3.26-51-425
64
DEFERRED COMPENSATION PLANS
IRA's
1.26-51-414
56
Lump-Sum Distributions
2.26-51-414
56
Self-Employed Ministers
3.26-51-414
57
Section 457 Plan Distributions
4.26-51-414
57
Penalty-Free Withdrawals
5.26-51-414
57
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
DEFINITIONS
Administrator
1.26-51-102(8)
18
Charitable Trust
1.26-51-102
18
Corporate Characteristics
1.26-51-102(5)
18
Estate
2.26-51-102
18
Estate Taxability
3.26-51-102
18
Executor
2.26-51-102(8)
19
Fiduciary
3.26-51-102(8)
19
Grantor Trust
4.26-51-102
19
Irrevocable Trust
5.26-51-102
20
Limited Liability Company
6.26-51-102
20
Limited Partnership
1.26-51-102(4)
20
Partnership
2.26-51-102(4)
21
Publicly Traded Partnership (PTP)
3.26-51-102(4)
21
Resident
1.26-51-102(9)
21
Residency Determination
2.26-51-102(9)
21
Revocable Trust
7.26-51-102
23
Trust
8.26-51-102
23
Trust Taxability
9.26-51-102
23
Trustee
4.26-51-102(8)
23
WITHHOLDING DEFINITIONS
Agricultural Labor -- Federal Definition
Agricultural Labor -- When Nonagricultural Labor
1.26-51-902(1)
94
is also Performed
2.26-51-902(1)
94
Agricultural Labor -- Landscaping Services
3.26-51-902(1)
95
Employer
1.26-51-902(6)
95
Transient Employer
1.26-51-902(12)
95
Wages for Agricultural Labor -- Cash Remuneration
1.26-51-902(13)(B)
96
Wages for Agricultural Labor -- Noncash Remuneration
2.26-51-902(13)(B)
96
Withholding of Income Tax on Agricultural Wages
1.26-51-902
(13)(B)(i)&(ii)
96
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
EXTENSION OF TIME FOR FILING RETURNS
First Ninety Day Extension
1.26-18-505(a)(3)(A)
14
Second Ninety Day Extension
1.26-18-505(a)(3)(B)
14
Federal Extension Recognized
1.26-18-505(a)(4)
14
FAILURE TO FILE RETURN OR INCLUDE INCOME
Taxpayer Required to File Return or Amended Return
1.26-51-808(a)&(b)
88
Penalties, Prosecution, Jeopardy Assessments
1.26-51-808(c)
89
FASITs
Defined
2.26-51-440
74
Qualification Requirements
3.26-51-440
74
Taxation of FASITs
4.26-51-440
75
Taxation of Regular Interests
5.26-51-440
75
Prohibited Transactions
6.26-51-440
75
Transfers of Assets to FASITs
7.26-51-440
75
FEDERAL SUBCHAPTER S ADOPTED
IRC Subchapter S Adopted
1.26-51-409
47
Corporations That Must File as an S Corporation
2.26-51-409
47
Applicable Rules - Generally
3.26-51-409
48
Auditing
4.26-51-409
48
Consistency Between Returns
5.26-51-409
48
Reporting S Corporation Income, Loss, Deductions and Credits
1.26-51-409(c)(1)
48
S Corporation Reporting; Shareholder Termination
2.26-51-409(c)(1)
48
Shareholder Basis
3.26-51-409(c)(1)
49
FIDUCIARIES
Fiduciaries -- Generally
1.26-51-203
25
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
FIDUCIARY RETURNS
Fiduciary Returns -- Generally
1.26-51-803
85
FILING RETURNS -- EXTENSIONS OF TIME
Extension of Time -- Generally
1.26-51-807(a)
87
Payment of Tax, Penalty and Interest
1.26-51-807(b)
88
FILING RETURNS -- TIME AND PLACE -- FORMS
Due Date and What Constitutes Filing
1.26-51-806(a)
86
Responsibility for Obtaining and Filing Returns
1.26-51-806(b)(1)
86
Signing Returns
1.26-51-806(c)
86
FILING OF EMPLOYER'S WITHHOLDING RETURN AND PAYMENT
OF INCOME TAXES WITHHELD
Filing Schedule for Employer's Withholding Returns
1.26-51-908(a)
97
Transient Employer
1.26-51-908(b)
97
Employers Engaged in a Seasonal Business
1.26-51-908(c)
97
Filing Requirements when Employer no Longer
Withholds Income Tax
1.26-51-908(g)
98
FORMS FOR TAX PRACTITIONERS
Fee Charged by Department
1.26-51-810
89
FORMS INDEX FOR INDIVIDUAL INCOME TAX
1
GAIN OR LOSS - EXCHANGE OF PROPERTY
Exchange of Property for Like Property
1.26-51-412(a)
52
Exchange of Property for Property Not of Like Kind
2.26-51-412(a)
53
Dividends Paid In Securities or Other Property
3.26-51-412(a)
53
Property Acquired as a Result of an Involuntary Conversion
4.26-51-412(a)
54
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
NUMBER
PAGE
NUMBER
Basis of Stock Received for Property - Real, Personal or Mixed
1.26-51-412(b)
54
Stock or Securities Exchanged in a Reorganization
1.26-51-412(c)
54
Stock or Securities Received in a Reorganization
2.26-51-412(c)
55
Basis of Stock or Securities Received in a Reorganization
3.26-51-412(c)
55
GAIN OR LOSS - SALES OF PROPERTY
Amount Realized on Disposition of Property
1.26-51-411(a)
50
Sale of Shares of Stock
2.26-51-411(a)
50
Sale of Real Estate or Personal Property
3.26-51-411(a)
52
Sale of Property Acquired by Gift
4.26-51-411(a)
52
Basis of Property Acquired On or Before March 9, 1929
5.26-51-411(a)
52
Patents and Copyrights
6.26-51-411(a)
52
GROSS INCOME GENERALLY
Classes of Income
1.26-51-404(a)(1)
33
Income Credited to an Account
2.26-51-404(a)(1)
34
Gross Income -- Manufacturing, Merchandising and Mining
3.26-51-404(a)(1)
34
Gross Income -- Independent Contractor
4.26-51-404(a)(1)
34
Services Paid For With Other Than Money
5.26-51-404(a)(1)
34
Notes of Indebtedness Used in Payment
6.26-51-404(a)(1)
35
Scholarships, Fellowships, Grants and Stipends
7.26-51-404(a)(1)
35
Commissions, Tips and Other Types of Compensation
8.26-51-404(a)(1)
35
Farm - Defined
9.26-51-404(a)(1)
35
Gain on Sale of Property or Capital Assets
10.26-51-404(a)(1)
36
Annuities and Endowment Contracts
11.26-51-404(a)(1)
36
Cost Basis of Divided Tract of Land
12.26-51-404(a)(1)
36
Buildings and Lease Hold Improvements
13.26-51-404(a)(1)
37
Long-Term Contracts
14.26-51-404(a)(1)
37
Stock Dividends and Distributions from Regulated
Investment Companies
15.26-51-404(a)(1)
37
Interest
16.26-51-404(a)(1)
37
Installment Sales - Personal Property
1.26-51-404(a)(2)
38
Installment Sales - Real Estate
2.26-51-404(a)(2)
39
Gain on Sale - Involuntary Conversion
1.26-51-404(b)(1)
40
Gain from Sale or Exchange of Principal Residence
1.26-51-404(b)(2)
41
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
Life Insurance Proceeds
1.26-51-404(b)(3)
41
Gifts
1.26-51-404(b)(5)
43
Bequests, Devise or Descent
2.26-51-404(b)(5)
43
Interest - Obligations of The United States or its Possessions
1.26-51-404(b)(6)
43
Interest - Obligations of the State of Arkansas
2.26-51-404(b)(6)
43
Social Security Benefits
1.26-51-404(b)(7)
44
Unemployment Benefits Paid by Organized Union
2.26-51-404(b)(7)
44
Unemployment Benefits Paid by State or Federal Agency
3.26-51-404(b)(7)
44
Cancellation or Forgiveness of Debt
1.26-51-404(b)(11)
44
Cafeteria Plan and FSA's
1.26-51-404(b)(12)
44
Lawsuit Damages
1.26-51-404(b)(15)
45
Tuition Savings Program (Act 1309 of 1997)
-- Generally
1.26-51-
98
-- Tax Consequences
2.26-51-
100
HEARING ON PROPOSED ASSESSMENTS
Hearing on Proposed Assessments
1.26-18-405(d)(4)(A)
13
HOUSEHOLD AND DEPENDENT CARE SERVICES
General Requirements for the Credit
1.26-51-502(a)&(b)(1)
76
Ten Percent (10%) Standard Credit
1.26-51-502(b)(2)
77
Twenty Percent (20%) Approved Child Care Facility Credit
1.26-51-502(c)(1)
77
Refundability
2.26-51-502(c)(1)
78
Election of Credits
1.26-51-502(c)(2)
78
INCOME FROM SALE OF HOME
One Time Exclusion of Gain from Gross Income
1.26-51-305(a)
25
One Time Exclusion of Gain from Gross Income
Amount Excludable
1.26-51-305(b)
25
One Time Exclusion of Gain from Gross Income
Example
1.26-51-305(c)
26
One Time Exclusion of Gain from Gross Income
Husband & Wife
1.26-51-305(d)(1)
26
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
NUMBER
PAGE
NUMBER
INCOME FROM SOURCES OUTSIDE ARKANSAS
Calculating the Credit
1.26-51-504(a)
79
Prerequisites to Claiming the Credit
1.26-51-504(b)
80
Restriction of Credit
1.26-51-504(c)
80
INCOME GENERALLY
Income Generally
1.26-51-403(b)
30
Long-Term Intergenerational Trusts
2.26-51-403(b)
31
Border City Tax Exemption -- Texarkana
1.26-51-403(b)(13)
31
INFORMATION AT SOURCE AS TO RECIPIENTS OF INCOME
Recipients of Income -- Generally
1.26-51-811(a)
89
INVENTORY
What Constitutes Inventory
1.26-51-410
49
JUDICIAL RELIEF
Judicial Relief
1.26-18-406(a)
14
MEDICAL SAVINGS ACCOUNTS
Defined
1.26-51-436(5)
72
Eligibility
2.26-51-436(5)
72
Deductibility from Income
3.26-51-436(5)
72
Exclusion from Income
4.26-51-436(5)
73
Taxability of Account Earnings
1.26-51-436(6)
73
Taxability of Account Distributions
1.26-51-436(7)
73
NONRESIDENTS OR PART-YEAR RESIDENTS
Computing Taxable Income
1.26-51-435(a)&(b)
70
Credit for Income Tax Paid to Another State
1.26-51-435(c)
70
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
Computing Percentage of AGI Attributable to Arkansas
1.26-51-435(d)
71
Calculating Arkansas Income Tax Due
1.26-51-435(e)
71
NONRESIDENTS
Income Producing Property
1.26-51-202(a)
24
Income Producing Property - Intangible
2.26-51-202(a)
24
Nonresident Generally
1.26-51-202(b)(1)
24
Income from Trust or Estate
1.26-51-202(d)
24
Allocation of Income to Arkansas Sources
1.26-51-202(c)
24
PARTNERSHIP INCOME
Partnership Income Generally -- Example
1.26-51-405
45
Partnership Composite Return
2.26-51-405
45
Partnerships
1.26-51-405(a)
45
Distributive Share of Partnership Income
2.26-51-405(a)
46
PARTNERSHIP RETURNS
Partnership Returns -- Generally
1.26-51-802(a)
85
Partnership Income From Arkansas Sources
1.26-51-802(b)
85
PASSIVE ACTIVITIES
Loss
1.26-51-436(2)
71
Credit (Oil & Gas Properties)
2.26-51-436(2)
71
PRESERVATION OF RECORDS BY TAXPAYER
Type of Records and Time Period
1.26-18-506(b)
15
Insufficient Records and Estimated Assessment
1.26-18-506(d)
15
RECEIPTS FOR TAXES
Receipts -- Generally
1.26-51-809
89
RETARDED CHILD
Tax Credit – Mentally Retarded Child
1.26-51-503
78
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
RETIREMENT PLANS AND DISABILITY BENEFITS
Retirement or Disability Benefits
1.26-51-307
27
Premature Distribution
2.26-51-307
28
Divorce
3.26-51-307
28
Military Related Benefits
4.26-51-307
28
RETURNS BY INDIVIDUALS
Who Should File
1.26-51-801(a)
80
Filing Status "4" -- Married Filing Separately
on the Same Return
2.26-51-801(a)
81
Completing and Signing Returns
1.26-51-801(c)
81
Head of Household
1.26-51-801(d)(1)
81
Surviving Spouse
1.26-51-801(d)(2)
81
Dependent Defined
1.26-51-801(d)(4)
82
Withholding for Low Income Employees
1.26-51-801(e)
84
SIMPLE PLANS
SIMPLE Retirement Saving Plans
6.26-51-414
58
SUBCHAPTER M
Adopted
1.26-51-440
73
SUBCHAPTER S
Adopted
1.26-51-409
52
TAX YEAR - ACCOUNTING METHOD
Method of Accounting
1.26-51-401(a)
29
Method of Accounting
2.26-51-401(a)
29
Change in Method of Accounting
1.26-51-401(b)
30
INDEX
INDIVIDUAL INCOME TAX REGULATIONS
REGULATION
PAGE
NUMBER
NUMBER
TAX YEAR - BASIS FOR DETERMINING LIABILITY
Tax Year - Calendar vs Fiscal Year
1.26-51-402(a)
30
TAXPAYER BILL OF RIGHTS
Your Rights as a Taxpayer
1.26-18-801
16
TAXPAYER RELIEF
Protest of Proposed Assessment
1.26-18-404(c)
13
TIME LIMITATIONS FOR ASSESSMENTS, COLLECTION, REFUNDS
AND PROSECUTION
Adjustment to Federal Return - Duty to Amend State Return
1.26-18-306(b)
13
Time Limitation on Refunds and "Verified Claim" for Credit
1.26-18-306(i)(2)
13
TUITION SAVINGS PROGRAM (Act 1309 of 1997)
Generally
1.26-51-
98
Tax Consequences
2.26-51-
100
Income Tax Regulations
Page 1
Forms Index for Individual Income Tax
Form No.
Form Description
AR3
Itemized Deductions
AR4
Interest & Dividend Income
AR1000
Individual Income Tax Forms and Instructions
AR1000NR
(includes resident and nonresident forms, instructions and tax
tables, AR1000DGW
and capital gains and losses adjustment schedule)
AR1000S
Short Individual Income Tax Form and Instructions
AR1000PTR
Arkansas Property Tax Refund Forms and Instructions
AR1000A
Arkansas Amended Forms and Instructions
(includes resident and nonresident forms and instructions)
AR1100S
Sub-Chapter S Forms and Instructions
AR1002
Fiduciary Forms and Instructions
(includes resident and nonresident forms and instructions)
AR1050
Arkansas Partnership Return and Partnership Instructions
AR1055
Extension of Time Request
(Individual, Sub-Chapter S, Fiduciary, Partnership and Corporation)
AR1103
Election by Small Business Corporation
AR1000RC5
Retarded Child Certificate
AR1000AC
Adoption Expense Income Tax Credit
AR1000DC
Disabled Child Certificate
AR1000EC
Arkansas Early Childhood Certification
AR1000TD
Lump Sum Distribution Averaging
AR2210
Individual Estimated Tax Penalty
AR1000ES
Individual Estimated Tax Vouchers and Estimated Tax Instructions
AR8453
Declaration for Electronic Filing
AY321
Estate Tax Return and Instructions
AY321E
Estate Tax Extension
Income Tax Regulations
Page 2
Forms may be obtained from any state revenue office. They may also be obtained through the mail by
writing or calling:
Arkansas State Income Tax Forms
P. O. Box 3628
Little Rock, AR 72203-3628
(501) 682-1100
(501) 682-4795 (hearing impaired/deaf access only)
Income Tax Regulations
Page 3
Assembling Your Arkansas Return
In order to assist the Income Tax Section in processing returns as quickly as possible, the forms should be
assembled in the order shown below beginning with AR1000, AR1000NR or AR1000S. Federal attachment
sequence numbers are shown in the upper right hand corner of the Federal Forms; Arkansas forms do
not have sequence numbers.
AR1000
Arkansas Individual Returns (with W-2s and check attached on front)
AR1000NR
AR1000S
AR1000DGW
Arkansas Capital Gains and Losses Schedule and Worksheet
AR2210
Arkansas Underpayment of Estimated Tax
AR3
Itemized Deductions
AR4
Interest & Dividend Income
AR1000TD
Arkansas Lump Sum Distribution Averaging
Federal 5329
Additional Tax Due to Qualified Retirement Plans
Federal 2441 or 1040A
Child Care Credits
AR1000EC
Arkansas Early Childhood Certification
AR1000AC
Arkansas Adoption Expense Income Tax Credit
Arkansas Business Tax Credit Schedules
AR1000RC5
Arkansas Certificate for Retarded Child
AR1000DC
Arkansas Disabled Child Certificate
Other State Returns
Federal 1040, 1040EZ or 1040A
Other Federal Forms and Schedules in Federal Sequence
Order** All Other Attachments not included in above.
**Federal Attachment Sequence Number
of Forms Generally Included with Arkansas Returns
(As shown on the Federal Form, upper right-hand corner)
FORM
NUMBER
SEQUENCE
Schedule A
Itemized Deductions
07
Schedule B
Interest and Dividend Income
08
Schedule C
Profit and Loss from Business
09
Schedule C-EZ
Net Profit from Business
09A
Schedule D
Capital Gains and Losses
12
Income Tax Regulations
Page 4
Form 4952
Investment Interest Expense Deductions
12A
Schedule E
Supplemental Income and Loss
13
Schedule F
Profit or Loss from Farming
14
Form 2119
Sale of Your Home
20
Form 4684
Casualties and Thefts
26
Form 4797
Sale of Business Property
27
Form 6198
At Risk Limitations
31
Form 2555
Foreign Earned Income
34
Form 4835
Farm and Rental Income and Expense
37
Form 8606
Nondeductible IRAs
47
Form 2106
Employee Business Expense
54
Form 2106-EZ
Unreimbursed Employee Business Expense
54A
Form 8283
NonCash Charitable Contributions
55
Form 3903
Moving Expense
62
Form 8829
Expense for Business Use of Home
66
Form 4562
Depreciation and Amortization
67
Form 6252
Installment Sale Income
79
Form 8582
Passive Activity Loss Limitations
88
Income Tax Regulations
Page 5
ADOPTED INTERNAL REVENUE CODES (1)
SUBJECT
IRC
DATE
ACA
Accident and Health Plans,
. amounts received
105
1-1-97
26-51-404(b)(15)
. contributions by employer
106
1-1-97
26-51-404(b)(15)
Accounting, (2)
. methods (2)
446-483 (2)
(2)
26-51-401
. periods (2)
441-444 (2)
(2)
26-51-402
Agricultural Labor
3121(g)
1-1-93
26-51-902(1)
Alimony and Separate Maintenance,
. deductions from gross income
215
1-1-87
26-51-417(b)
. income to recipient
71
1-1-87
26-51-417(a)
Amortization
197
1-1-95
26-51-428(c)
Amount of Credit
. qualified person
46(c)(8)(D)
1-1-89
26-51-404(b)(11)
At Risk
465
1-1-87
26-51-436(1)
Bad Debt, Losses and Gains with Respect
to Securities Held by Financial
Institutions
582
1-1-97
26-51-426
Business Expense (3)
162 (3)
1-1-97
26-51-423(a)(1)
Cafeteria Plan
125
1-1-97
26-51-404(b)(12)
Capital Gains (6)
. limitations on capital losses
1211
1-1-97
26-51-815
. capital loss carrybacks and carryovers
1212
1-1-97
26-51-815
. capital assets defined
1221
1-1-97
26-51-815
. other terms relating to capital gains
and losses
1222
1-1-97
26-51-815
. holding period of property
1223
1-1-97
26-51-815
. property used in the trade or business
and involuntary conversions
1231
1-1-97
26-51-815
. gains and losses from short sales
1233
1-1-97
26-51-815
. options to buy or sell
1234
1-1-97
26-51-815
. gains and losses from certain
terminations
1234A
1-1-97
26-51-815
. sale or exchange of patents
1235
1-1-97
26-51-815
. dealers in securities
1236
1-1-97
26-51-815
. real property subdivided for sale
1237
1-1-97
26-51-815
. gain from sale of depreciable property
between certain related taxpayers
1239
1-1-97
26-51-815
. cancellation of lease or distributor's agreement
1241
1-1-97
26-51-815
. losses on small business investment
company stock
1242
1-1-97
26-51-815
. loss of small business investment
company
1243
1-1-97
26-51-815
. losses on small business stock
1244
1-1-97
26-51-815
. gain from dispositions of certain
depreciable property
1245
1-1-97
26-51-815
Income Tax Regulations
Page 6
ADOPTED INTERNAL REVENUE CODES (1)
SUBJECT
IRC
DATE
ACA
Capital Gains (cont.)
. gain on foreign investment company stock
1246
1-1-97
26-51-815
. election by foreign investment companies
to distribute income currently
1247
1-1-97
26-51-815
. gain from certain sales or exchanges
of stock in certain foreign corporations
1248
1-1-97
26-51-815
. gain from certain sales or exchanges of
patents, etc., to foreign corporations
1249
1-1-97
26-51-815
. gain from dispositions of certain
depreciable realty
1250
1-1-97
26-51-815
. gain from disposition of farm land
1252
1-1-97
26-51-815
. transfers of franchises, trademarks, and
trade names
1253
1-1-97
26-51-815
. gain from disposition of interest in oil,
gas, geothermal, or other mineral properties
1254
1-1-97
26-51-815
. gain from disposition of section 126 property
1255
1-1-97
26-51-815
. section 1256 contracts marked to market
1256
1-1-97
26-51-815
. disposition of converted wetlands on
highly erodible croplands
1257
1-1-97
26-51-815
Capitalization Rules
263(a-h)
1-1-89
26-51-439
Child Care Credit
21
1-1-97
26-51-502(b)(1)
Charitable Contributions
170
1-1-97
26-51-419
Combat Pay
112
1-1-97
26-51-306(a)(4)
Corporate Liquidations,
. basis of property
334
1-1-97
26-51-413
. complete liquidation of subsidiaries
332
1-1-97
26-51-413
. gain or loss to liquidating corporation
336
1-1-97
26-51-413
. nonrecognition for property distributed
337
1-1-97
26-51-413
. purchase of stock as purchase of assets
338
1-1-97
26-51-413
Cost-Sharing Payments
126
1-1-97
26-51-404(b)(18)
Credit for Adoption Expenses
23
1-1-97
26-51-445
Deferred Compensation Plans,
. annuities
72
1-1-97
26-51-414
. collectively bargained plans
413
1-1-97
26-51-414
. deduction for employer's contributions
404
1-1-97
26-51-414
. definitions and special rules
414
1-1-97
26-51-414
. employee plans-domestic
407
1-1-97
26-51-414
subsidiaries in foreign operations
. employee plans-foreign affiliates
406
1-1-97
26-51-414
. employee plans-taxation of annuities
403
1-1-97
26-51-414
. foreign deferred compensation plans
404A
1-1-97
26-51-414
. individual retirement accounts(IRA)
408
1-1-97
26-51-414
. limitations on benefits and
415
1-1-97
26-51-414
contributions under qualified plan
Income Tax Regulations
Page 7
. ADOPTED INTERNAL REVENUE CODES (1)
SUBJECT
IRC
DATE
ACA
Deferred Compensation Plans (cont.)
minimum funding standards
412
1-1-97
26-51-414
. minimum participation standards
410
1-1-97
26-51-414
. minimum vesting standards
411
1-1-97
26-51-414
. qualification for tax credits employee
409
1-1-97
26-51-414
stock ownership plans(PAYSOPS)
. qualified pension, profit sharing and
401
1-1-97
26-51-414
stock bonus plans
. retirement savings
219
1-1-97
26-51-414
. special rules for top-heavy plans
416
1-1-97
26-51-414
. state/local govt. & tax exempt org.
457
1-1-97
26-51-414
. taxability of beneficiary of employee's trust
402
1-1-97
26-51-414
Definitions and Special Rules,
. head of household
2(b)
1-1-91
26-51-301(c)(1)
. surviving spouse
2(a)
1-1-91
26-51-801(d)(1)
Depletion,
. allowance of deduction for depletion
611
1-1-91
26-51-429
. basis for cost depletion
612
1-1-91
26-51-429
. deduction and recapture of certain
617
1-1-91
26-51-429
mining exploration expenditures
. definition of property
614
1-1-91
26-51-429
. development expenditures
616
1-1-91
26-51-429
. percentage depletion
613
1-1-91
26-51-429
Dependent Defined
152
1-1-91
26-51-801(d)(4)
Dependent Care
129
1-1-97
26-51-404(b)(13)
Depreciation
. accelerated cost recovery system
168
1-1-97
26-51-428(a)
. depreciation
167
1-1-97
26-51-428(a)
. election to expense certain business assets
179, 179A
1-1-97
26-51-428(a)
Depreciation Limitation,
. investment tax credit and depreciation
280F(a-d)
1-1-91
26-51-436(3)
for luxury automobiles
Discharge of Indebtedness
108
1-1-95
26-51-404(b)(11)
Discharge of Indebtedness
1017
1-1-95
26-51-404(b)(11)
Entertainment Expenses
274
1-1-97
26-51-423(b)
Estate Tax,
26-51-201
. deferral of payments
6166
1-1-89
26-51-203
Farming 464(e)(1)
464(e)(1)
1-1-89
26-51-427(1)
Foreign Income,
. citizens or residents of the
911
1-1-89
26-51-310
United States living abroad
. exemption for certain allowances
912
1-1-89
26-51-310
Foster Care Payments
131
1-1-95
26-51-404(b)(19)
Fringe Benefits
132
1-1-97
26-51-404(b)(20)
FASITS (5)
851-860 (5)
1-1-97
26-51-440
Gross Income
61
AR SIMILAR* 26-51-404
Group-Term Life Insurance,
. purchased for employees
79
1-1-89
26-51-404(b)(14)
Individual Retirement Account (4)
219 (4)
1-1-97
26-51-414
Income Tax Regulations
Page 8
ADOPTED INTERNAL REVENUE CODES (1)
SUBJECT
IRC
DATE
ACA
Income Tax Forgiveness for Armed Forces
and Government Personnel Injured Overseas
692
1-1-97
26-51-306(a)(4)
Injuries or Sickness,
. compensation for
104
1-1-97
26-51-404(b)(15)
Installment Method
453(a-b)
1-1-95
26-51-411(e)
Interest
163
1-1-97
26-51-415
. on certain deferred payments
483
1-1-93
26-51-443(a)
. on loans with below-market interest rates
7872
1-1-97
26-51-443(b)
Itemized Deduction
. limitations
68
1-1-95
26-51-436(4)
Involuntary Conversion
1033
1-1-97
26-51-404(b)(1)
Life Insurance Proceeds
. exclusion from income
101
1-1-97
26-51-404(b)(3)
Long Term Care Insurance Premiums
7702
1-1-97
26-51-423
Meals & Lodging
119
1-1-97
26-51-404(b)(17)
Medical and Dental
213
1-1-97
26-51-423(a)(2)
Medical Savings Accounts
220
1-1-97
26-51-436
Moving Expenses
217
1-1-95
26-51-423(a)(4)
. reimbursements
82
1-1-95
26-51-404(b)(16)
Offers in Compromise
7122
AR SIMILAR* 26-18-705
Passive Activity
469
1-1-97
26-51-436(2)
. at risk limitations
465
1-1-87
26-51-436(1)
Railroad Retirement Benefits (tier 2)
72
1-1-97
26-51-414
Regulated Investment Companies (5)
851-860 (5)
1-1-97
26-51-440
. Subchapter M
851-860 (5)
1-1-97
26-51-440
Reserves for Losses on Loans of Bank
585
1-1-97
26-51-426
Reserves for Losses on Loans
593
1-1-97
26-51-426
Retirement
. Individual Retirement Account (4)
219 (4)
1-1-97
26-51-414
. SIMPLE Retirement Account
408
1-1-97
26-51-414
Sale of Home
121
AR SIMILAR* 26-51-305
Sale of Home
121
AR SIMILAR* 26-51-404(b)(2)
Sale of Property to Comply with
Conflict-of-Interest Requirements
1043
1-1-93
26-51-442
Self-Employed Health Insurance Cost
162
1-1-97
26-51-423(c)(1)
Severance Pay
61
AR SIMILAR* 26-51-404
SIMPLE Retirement Account
408
1-1-97
26-51-414
Small Business Stock
1202
1-1-95
26-51-815(c)
Soil & Water Conservation
175
1-1-95
26-51-404(b)
Subchapter M (5)
851-860 (5)
1-1-97
26-51-440
. regulated investment companies
851-860 (5)
1-1-97
26-51-440
. FASITS
851-860 (5)
1-1-97
26-51-440
Subchapter S corporation,
. adjustments to basis of stock
1367
1-1-97
26-51-409
. coordination with subchapter C
1371
1-1-97
26-51-409
. defined
1361
1-1-97
26-51-409
Income Tax Regulations
Page 9
. definitions and special rules
1377
1-1-97
26-51-409
ADOPTED INTERNAL REVENUE CODES (1)
SUBJECT
IRC
DATE
ACA
Subchapter S (Cont)
distributions
1368
1-1-97
26-51-409
. coordination with subchapter C
1371
1-1-97
26-51-409
. defined
1361
1-1-97
26-51-409
. definitions and special rules
1377
1-1-97
26-51-409
. distributions
1368
1-1-97
26-51-409
. effect of election on corporation
1363
1-1-97
26-51-409
. election; revocation; termination
1362
1-1-97
26-51-409
. foreign income
1373
1-1-97
26-51-409
. partnership rules
1372
1-1-97
26-51-409
. pass-thru of items to shareholders
1366
1-1-97
26-51-409
. taxable year of S corporation
1378
1-1-97
26-51-409
. tax imposed on certain built-in gains
1374
1-1-97
26-51-409
. tax imposed when passive investment income
1375
1-1-97
26-51-409
. transitional rules of enactment
1379
1-1-97
26-51-409
Tax Deferred Tuition Savings Plan
529
1-1-97
6-84-102
Tax-Exempt Income, Relating to Expenses
and Interest
265(a)
1-1-97
26-51-431(b)
Trade or Business Expenses (5)
162(5)
1-1-97(5)
26-51-423(a)(1)
Notes:
(1)
In those instances where Arkansas has adopted a section of the Internal Revenue Code (IRC) as its own law,
the regulations promulgated by the Treasury Department to aid in interpreting the IRC section should be
used for guidance in applying the law. For example, at ACA 26-51-306(a)(4) Arkansas adopted IRC Sec. 112
as in effect on January 1, 1991 regarding tax treatment of combat pay. The tax practitioner would refer to
the corresponding regulation (IRC Reg. 1.112-1) when working on a combat pay issue under ACA 26-51-
306(a)(4).
(2)
Internal Revenue Code sections 441 - 444, dealing with accounting periods, and sections 446 - 483, dealing with
accounting methods, have not been officially adopted by the State of Arkansas. The corresponding Arkansas codes
do require the taxpayer to file his/her Arkansas return using the same accounting period and the same accounting
method as used for Federal purposes.
(3)
Subsection "n" of IRC Sec. 162 has not been adopted by Arkansas.
(4)
Requirements for filing a joint return under 219(c)(a)(A) of the Internal Revenue code of 1986 shall not apply.
(5)
Provisions of Subchapter M of the Internal Revenue code addressing tax rates are not adopted.
(6)
The capital gain provisions of ACA 26-51-815 do not apply to C corporations.
Income Tax Regulations
Page 10
* Arkansas has not adopted the cited Internal Revenue Code (IRC) section as its own law. However, the language
of Arkansas' statute is similar to that of the federal statute.
Income Tax Regulations
Page 11
ADOPTED INTERNAL REVENUE CODES (1)
IRC
SUBJECT
DATE
ACA
2(a)
Surviving Spouse
1-1-91
26-51-801(d)(1)
2(b)
Head of Household
1-1-91
26-51-301(c)(1)
21
Child Care Credit
1-1-97
26-51-502(b)(1)
23
Credit for Adoption Expenses
1-1-97
26-51-445
46(c)(8)(D)
Qualified Person
1-1-89
26-51-404(b)(11)
61
Gross Income
AR SIMILAR*
26-51-404
61
Severance Pay
AR SIMILAR*
26-51-404
68
Itemized Deduction Limit
1-1-95
26-51-436(4)
71
Alimony Income
1-1-87
26-51-417(a)
72
Railroad Retirement
1-1-97
26-51-414(a)
79
Group Term Insurance
1-1-89
26-51-404(b)(14)
82
Moving Exp. Reimb.
1-1-95
26-51-404
101
Exclusions of Proceeds Paid Upon
Illness or Death of Insured
1-1-97
26-51-404(b)(3)
104
Injury or Sickness
1-1-97
26-51-404(b)(15)
105
Accident/Health
1-1-97
26-51-404(b)(15)
106
Accident/Health
1-1-95
26-51-404(b)(15)
108
Discharge Indebt.
1-1-97
26-51-404
112
Combat Pay
1-1-97
26-51-306(a)(4)
119
Meals & Lodging
1-1-97
26-51-404
121
Sale of Home
AR SIMILAR*
26-51-305
121
Sale of Home
AR SIMILAR*
26-51-404(b)(2)
125
Cafeteria Plan
1-1-97
26-51-404(b)(12)
126
Cost-Sharing Payments
1-1-95
26-51-404(b)(18)
129
Dependent Care
1-1-97
26-51-404(b)(13)
131
Foster Care Payments
1-1-95
26-51-404
132
Fringe Benefits
1-1-95
26-51-404
152
Dependent Defined
1-1-91
26-51-801(d)(4)
162
S/E Health Insurance
1-1-97
26-51-403(b)(14)
162
S/E Health Insurance
1-1-97
26-51-423(c)(1)
162 (3)
Business Expenses (3)
1-1-97
26-51-423(a)(1)
163
Interest
1-1-97
26-51-415
167
Depreciation
1-1-97
26-51-428(a)
168
Depreciation-ACRS
1-1-97
26-51-428(a)
170
Charitable Contributions
1-1-97
26-51-419
175
Soil & Water Conserv.
1-1-95
26-51-404(b)
179
Election to Expense Certain Business
Assets
1-1-97
26-51-428(a)
194
Reforestation Amort.
NO AR CODE
197
Amortization
1-1-95
26-51-428
213
Medical
1-1-97
26-51-423(a)(2)
215
Alimony Deduction
1-1-87
26-51-417(b)
217
Moving Expenses
1-1-95
26-51-423(a)(4)
219 (4)
Individual Retirement Account (4)
1-1-97
26-51-414
220
Medical Savings Accounts
1-1-97
26-51-436
221
Interest on Education Loans
1-1-97
26-51-423(d)
Income Tax Regulations
Page 12
263A(a)-(h)
Cap. Rules
1-1-89
26-51-439
ADOPTED INTERNAL REVENUE CODES (1)
265(a)
Tax Exempt Interest
1-1-93
26-51-431(b)
274
Entertainment Expenses
1-1-97
26-51-423(b)
280F(a)-(d)
Dep. Lux. Autos
1-1-91
26-51-436(3)
332
Corp. Liquidations
1-1-97
26-51-413
334
Corp. Basis of Prop.
1-1-97
26-51-413
336
Corp. Gain & Loss
1-1-97
26-51-413
337
Corp. Nonrecognition
1-1-97
26-51-413
338
Corp. Purchase Stock
1-1-97
26-51-413
401
Qualified Pension
1-1-97
26-51-414
402
Emp. Beneficiary
1-1-97
26-51-414
403
Annuities
1-1-97
26-51-414
404
Employer's Contr.
1-1-97
26-51-414
404A
Foreign Deferred Comp.
1-1-97
26-51-414
406
Foreign Affiliates
1-1-97
26-51-414
407
Domestic Deferred Comp.
1-1-97
26-51-414
408
IRA'S, SIMPLE Retirement Acct
1-1-97
26-51-414
409
Tax Credit Employees
1-1-97
26-51-414
410
Participation Stds.
1-1-97
26-51-414
411
Minimum Vesting Stds.
1-1-97
26-51-414
412
Minimum Funding Stds.
1-1-97
26-51-414
413
Collect. Bargain Pls.
1-1-97
26-51-414
414
Definitions and Rules
1-1-97
26-51-414
415
Benefits & Contrib.
1-1-97
26-51-414
416
Top-Heavy Plans
1-1-97
26-51-414
441-444 (2)
Accounting Periods (2)
(2)
26-51-402
446-483 (2)
Accounting Methods (2)
(2)
26-51-401
453
Install Method
1-1-95
26-51-411
453A
"
"
"
453B
"
"
"
457
Def. Comp. Tax Exempt
1-1-97
26-51-414
464(e)(1)
Farming
1-1-89
26-51-427(1)
465
At Risk
1-1-87
26-51-436(1)
469
Passive Activities
1-1-97
26-51-436(2)
483
Interest on Def. Pay.
1-1-97
26-51-441(a)
529
Tax Deferred Tuition Savings Plan
1-1-97
582
Bad Debts
1-1-97
26-51-426
585
Reserve for Losses
1-1-97
26-51-426
593
Reserve for Losses
1-1-97
26-51-426
611
Depletion
1-1-91
26-51-429
612
Cost Depletion
1-1-91
26-51-429
613
Percent Depletion
1-1-91
26-51-429
614
Definition/Property
1-1-91
26-51-429
616
Development Expense
1-1-91
26-51-429
617
Mining Expenses
1-1-91
26-51-429
664
Charitable Remainder Trusts
1-1-93
26-51-309
692
Tax Forgiveness for Armed Forces
& Govt. Employees Injured Overseas
1-1-97
26-51-306(a)(4)
851-860 (5)
Sub. M/Reg.Invest.Co./FASIT (5)
1-1-95
26-51-440
911
Foreign Income Exclusion
1-1-89
26-51-310
Income Tax Regulations
Page 13
ADOPTED INTERNAL REVENUE CODES (1)
912
Foreign Income Exclusion
1-1-89
26-51-310
1017
Discharge Indebt.
1-1-95
26-51-404
1033
Involuntary Conver.
1-1-97
26-51-404(b)(1)
1043
Sale of Prop/Conflict
1-1-93
26-51-442
1202
Small Bus. Stock
1-1-95
26-51-815
1211
Cap. Gains Limits
1-1-97
26-51-815
1212
Carryovers/Carrybacks
1-1-97
26-51-815
1221
Cap. Assets/Defined
1-1-97
26-51-815
1222
Other Terms/Cap. Gains
1-1-97
26-51-815
1223
Holding Period
1-1-97
26-51-815
1231
Involuntary Conversion
1-1-97
26-51-815
1233
Short Sales
1-1-97
26-51-815
1234
Options
1-1-97
26-51-815
1234A
Certain Terminations
1-1-97
26-51-815
1235
Sale of Patents
1-1-97
26-51-815
1236
Dealers in Securities
1-1-97
26-51-815
1237
Subdivided Property
1-1-97
26-51-815
1239
Sale of Deprec. Prop.
1-1-97
26-51-815
1241
Lease/Distr. Agree.
1-1-97
26-51-815
1242
Small Business Stock
1-1-97
26-51-815
1243
Small Business Co.
1-1-97
26-51-815
1244
Small Business Stock
1-1-97
26-51-815
1245
Gain from Disposition
1-1-97
26-51-815
1246
Foreign Inv. Stock
1-1-97
26-51-815
1247
Election to Distribute
1-1-97
26-51-815
1248
Gains from Exchanges
1-1-97
26-51-815
1249
Gains from Exchanges
1-1-97
26-51-815
1250
Gain from Disp.
1-1-97
26-51-815
1252
Gain from Disp/Farm
1-1-97
26-51-815
1253
Trf of Franchises, Etc.
1-1-97
26-51-815
1254
Gain/Mineral Prop.
1-1-97
26-51-815
1255
Gain/Section 126 Prop.
1-1-97
26-51-815
1256
Section 1256 Contract
1-1-97
26-51-815
1257
Wetlands
1-1-97
26-51-815
1361
Sub S. Corporation
1-1-97
26-51-409
1362
Election
1-1-97
26-51-409
1363
Corp. Election
1-1-97
26-51-409
1366
Pass-thru
1-1-97
26-51-409
1367
Basis of Stock
1-1-97
26-51-409
1368
Distributions
1-1-97
26-51-409
1371
Coordination W/C
1-1-97
26-51-409
1372
Partnership Rules
1-1-97
26-51-409
1373
Foreign Income
1-1-97
26-51-409
1374
Built-In Gains
1-1-97
26-51-409
1375
Passive Investment
1-1-97
26-51-409
1377
Special Rules
1-1-97
26-51-409
1378
Taxable Year
1-1-97
26-51-409
1379
Rules of Enactment
1-1-97
26-51-409
3121(g)
Agricultural Labor
1-1-89
26-51-902(1)
6166
Estate Tax
AR SIMILAR*
26-51-201/03
Income Tax Regulations
Page 14
ADOPTED INTERNAL REVENUE CODES (1)
7122
Compromise
AR SIMILAR*
26-18-705
7872
Loans/Below-Mkt. Int.
1-1-99
26-51-443(b)
7702
Long Term Care Ins. Premiums
1-1-97
26-51-423
Notes:
(1)
In those instances where Arkansas has adopted a section of the Internal Revenue Code (IRC) as its own
law, the regulations promulgated by the Treasury Department to aid in interpreting the IRC section
should be used for guidance in applying the law. For example, at ACA 26-51-306(a)(4) Arkansas
adopted IRC Sec. 112 as in effect on January 1, 1997 regarding tax treatment of combat pay. The tax
practitioner would refer to the corresponding regulation (IRC Reg. 1.112-1) when working on a combat
pay issue under ACA 26-51-306(a)(4).
(2)
Internal Revenue Code sections 441 - 444, dealing with accounting periods, and sections 446 - 483, dealing
with accounting methods, have not been officially adopted by the State of Arkansas. The corresponding
Arkansas codes do require the taxpayer to file his/her Arkansas return using the same accounting period and
the same accounting method as used for Federal purposes.
(3)
Subsection "n" of IRC Sec. 162 has not been adopted by Arkansas.
(4)
Requirements for filing a joint return under 219(c)(1)(A) of the Internal Revenue Code of 1986 shall not apply.
(5)
Provisions of Subchapter M of the Internal Revenue Code addressing tax rates are not adopted.
* Arkansas has not adopted the cited Internal Revenue Code (IRC) section as its own law. However, the
language of Arkansas' statute is similar to that of the federal statute.
Income Tax Regulations
Page 15