Summary of Tax Cuts
Act 22 of 2015 reduced taxes for approximately 688,000 Middle Class taxpayers by cutting the tax rates for those making between $21,000 and $75,000. The total tax reduction for middle class taxpayers amounts to over $100M annually. This change was effective January 1, 2016.
For tax year 2016 and after, taxpayers having taxable income between $21,000 and $75,000 will pay tax on that portion of their income between $21,000 and $35,099 at the rate of 5% rather than the 6% rate in effect for 2014. That portion of their income between $35,100 and $75,000 will be taxed at the rate of 6% rather than the 7% rate previously applicable.
In Arkansas, two income households can file separately on the same return. This means, in a two income household with both earners falling within the range of the middle class tax cut, both would receive the benefit.
|Middle Class Tax Relief||-33.7M||-102.1M||-$107.4M||-$112.8M||-$118.4M||-$474.4M|
Number of Arkansas Taxpayers Benefiting: 688,000
Impact to Taxpayers:
$35,000 Net Taxable Income
Tax Savings -- $110.00
$50,000 Net Taxable Income
Tax Savings -- $246.00
$75,000 Net Taxable Income
Tax Savings -- $470.00