Arkansas Corporation Income Tax Amended Return
Form AR1100CTX is obsolete, and is no longer supported by the Arkansas Department of Revenue.
Extracted from PDF file 2019-arkansas-form-ar1100ctx.pdf, last modified September 2020
Corporation Income Tax Amended ReturnARKANSAS 2020 C Corporation Income Tax Instructions Due Date: On or before the 15th day of the 4th month following the close of the tax year, for calendar year filers the due date is April 15th. Simple Reasons to e-file! Arkansas Filing Confirmation Provided Makes Complex Returns Easy File Federal & State Forms Together e file Secure Mailing Address: State of Arkansas Corporation Income Tax Section P.O. Box 919 Little Rock, Arkansas 72203-0919 Physical Address: Corporation Income Tax 1816 W 7th St, Room 2250 Ledbetter Building Little Rock, AR 72201-1030 Page 1 TAX HELP AND FORMS Internet You can access the Department of Finance and Administration’s website at www.dfa.arkansas.gov. Get current and prior year forms and instructions Access latest income tax info and archived news Get e-file information You can e-mail questions to: [email protected] Phone General Information..................................................(501) 682-4775 Representatives are available to assist callers at the number above during normal business hours (Monday through Friday from 8:00 a.m. to 4:30 p.m.) with: Taxpayer Assistance Notices Received Forms Amended Returns Audit and Examination Payment Information Other useful phone numbers: Business Incentive Credits.............. (501) 682-7106 Withholding Tax............................... (501) 682-7290 Collections....................................... (501) 682-5000 Revenue Legal Counsel.................. (501) 682-7030 Individual Income Tax...................... (501) 682-1100 Sales and Use Tax........................... (501) 682-7104 Problem Resolution and.................. (501) 682-7751 Tax Information Office (Offers In Compromise) Internal Revenue Service................ (800) 829-1040 Social Security Administration......... (800) 772-1213 Forms To obtain a booklet or forms you may: ATAP Arkansas Taxpayer Access Point (ATAP) allows taxpayers or their representatives to log on to a secure site and manage their account online. Access ATAP at www.atap.arkansas.gov to: Make Tax Payments Make Estimated Tax Payments Make name and address changes View account letters (Registration is not required to make payments or to check refund status.) Mail Corporation Income Tax Section P. O. Box 919 Little Rock, AR 72203-0919 Be sure to apply sufficient postage or your return will not be delivered by the U.S. Postal Service. Walk-In Representatives are available to assist walk-in taxpayers with corporate income tax questions, but are not available to prepare your return. No appointment is necessary, but plan to arrive before 4:00 p.m. to allow sufficient time for assistance. The Corporate Income Tax Office is located at: 1816 W. 7th Street, Room 2250 Ledbetter Building, Little Rock, AR 72201 Office hours are Monday through Friday from 8:00 a.m. to 4:30 p.m. 1. Access our website at: https://www.dfa.arkansas.gov/income-tax/corporation/corporation-forms/ 2. Call: (501) 682-4775 Page 2 CONTENTS Tax Help and Forms........................................................................................................... 2 What’s New for 2020.......................................................................................................... 4 Important Reminders for 2020.........................................................................................5-8 Instructions: Domestic and Foreign Income Tax General Instructions................................................9-11 Specific Line Instructions, AR1100CT Return..........................................................12-14 Income from Sources Within and Without the State Instructions.............................15-20 Financial Institutions..........................................................................................................21 Business Incentive Tax Credits.................................................................................... 22-27 Exempt Organizations and Subchapter S....................................................................... 28-29 Tax Tables.................................................................................................................... 30-31 Page 3 WHAT’S NEW for 2020 NOTE: The following is a brief description of each Act and is not intended to replace a careful reading of the Act in it’s entirety. The Arkansas Legislature enacted numerous changes to the Arkansas Tax Code in 2019. However, many of those changes are not effective until future tax years. Federal Tax Changes adopted in the 2020 Cares Act can only be adopted for Arkansas if the Arkansas Legislature adopts them in the 2021 Legislative Session. Act 822 of 2019 amends Arkansas Code Annotated 26-5-101, Article IV, 26-51-709 through 26-51-718 and 26-51-1401 through 26-51-1405 to provide for a single sales factor to apportion income from both within and without Arkansas for tax years beginning on or after January 1, 2021. Act 822 also amends Arkansas Code Annotated 26-51-205 to reduce the maximum corporation income tax rate to 6.2% for taxable income that exceeds $100,000 for tax years beginning on or after January 1, 2021, and for tax years beginning on or after January 1, 2022 the maximum income tax rate shall be 5.9% for income exceeding $25,000. Act 822 amends Arkansas Code Annotated 26-51-427 to allow net operating losses occurring in tax years beginning on or after January 1, 2020 to be carried forward 8 tax years and net operating losses occurring in tax years beginning on or after January 1, 2021 to carry forward 10 tax years. Page 4 IMPORTANT REMINDERS for 2020 Federal Subchapter S Corporations cannot file Arkansas C Returns Act 434 of 2017 amends ACA 26-51-409(b) to require a corporation filing a federal Subchapter S income tax return to file an Arkansas Subchapter S income tax return. ACA 26-51-413(b) is repealed. Federal Subchapter S corporations will no longer be allowed to file Arkansas C corporation income tax returns for tax years beginning on or after January 1, 2018. Overpayments made for 2017 estimate payments or 2018 Estimated Credit Carryforwards can be applied to Composite Accounts, Withholding or refunded but will not be applied to Individual Accounts. Effective for tax years beginning on and after January 1, 2018. Multistate Corporations must allocate income from partnerships Act 482 of 2017 amends ACA 26-51-802(c) to require that Partnership income be determined for state income tax purposes by using an apportionment method. Partners will continue to allocate partnership income. Effective for tax years beginning on and after January 1, 2018. Withholding Payments Form AR1100-WH is a new form for 2017 and following years which corresponds with Line 36 on Form AR1100CT for corporations to report withholding tax paid on their behalf by partnerships and will need to be included with Form AR1100CT. Corporations claiming withholding must attach Form AR1100-WH listing each partnership that withheld tax and a copy of Form AR1099PT from each partnership. The partnership must have filed its annual withholding return of Form AR941PT and paid the tax withheld before credit for the withholding will be allowed. Withholding Payments as Reported on Form AR941PT Act 760 of 2017 amends ACA 26-51-919(a)(2), (b)(l)(A)(i). (c)(5)(A) and (d) for the income tax withholding requirements for members or owners of a pass-through entity to require withholding on corporate partners and to allow corporations to participate in composite returns. Effective for tax years beginning on and after January 1, 2018. Amended Tax Returns For tax years beginning on or after January 1, 2010 the AR1100CTX Arkansas Amended Return form was removed. An Arkansas Amended Return will be filed on the Form AR1100CT by checking the appropriate box as filing an Amended Return. Taxpayers should use Form AR1100CTX for tax years 2009 and prior. A copy of the corporation’s Federal Amended Return, or IRS audit report, or an explanation for filing the Arkansas Amended Return must be attached to the Form AR1100CT. Arkansas Form AR1100CT To correctly process the Corporation’s return it is essential that every applicable line and space on Form AR1100CT and related schedules be typed or printed including tax year, corporation name, address, city, state, zip code, telephone number, FEIN (Federal Employer Identification Number), date of incorporation, NAICS business code used on the federal return, date began business in Arkansas, and filing status (check one box only). If consolidated box 4 is checked, you must also indicate number of entities in Arkansas in the space immediately to the right of Filing Status 4 description. Consolidated filers must complete a Form AR1100CT (with Schedule A if applicable) for each corporate entity and a separate Form AR1100CT for the consolidated group. If Filing Status 4 is checked, do not check any other filing status box. An Arkansas consolidated group with its members having business activity only within Arkansas must check the box for filing Status 4. Page 5 To correctly process Corporate Income Tax payments, use the AR1100ESCT for Estimate payments and AR1100CTV for Corporate Income Tax payments. For Composite payments use the AR1000CRES for Estimate payments and AR1000CRV for Composite return tax payments. ATAP - Arkansas Taxpayer Access Point Arkansas Taxpayer Access Point (ATAP) is available for the filing of most Arkansas Corporation Income Tax returns and tax payments. Federal returns and other required schedules must be attached with the ATAP filing or mailed separately to the Corporation Income Tax Section. They may be provided on CD, in PDF, or in paper form. The secure online filing, managing, and payment options of ATAP are available at www.atap.arkansas.gov. Taxpayers and their authorized representatives will be able to view and manage their Corporation Income Tax activity including other tax activity such as Individual Income Tax, Sales Tax. Withholding Tax, and other taxes administered by DFA. Accountants and attorneys must obtain permission from their clients to access and view their client’s accounts. ATAP is a web-based service that will give taxpayers, or their designated representative, online access to their tax accounts, and offers the following services: Register a business, file a return online, file a return using XML return upload, change a name, change an address, amend a return, make a payment, store banking information for use during payment submission, view tax period financial information (tax, penalty, interest, credits, balance, etc.), view payments received, view recent account activity, view correspondence from the department. If you are currently enrolled with our online systems to either make payments or file a return electronically, you will need to sign up in ATAP to take advantage of the enhanced services. To correctly process payments on ATAP, make sure you are choosing the correct type of payment and applying it to the correct tax year. The Arkansas Corporation Income Tax Return must be organized as follows: Other than Filing Status 4 Filers: Arkansas Form AR1100CT (front) (Must be signed on Schedule A, page 2) Arkansas Form AR1100CT Schedule A, if applicable Arkansas Schedule of Check-Off Contributions, Form AR1100CO if applicable Arkansas approved extension, if applicable Arkansas Reconciliation Schedule, Form AR1100REC Business Incentive Tax Credit Certificates (originals), if any, Schedule AR1100BIC, if applicable Copy of Federal return with supporting schedules All other schedules pertaining to the Arkansas return Corporations with Filing Status 2 must complete Schedule A (Apportionment Schedule). Page 6 Filing Status 4 Filers: Arkansas Form AR1100CT (page 1 only) for Group (Must be signed on Schedule A, page 2) Arkansas Form AR1100CT for each entity (including parent) within the Group, and Schedule A, if applicable Arkansas Schedule of Check-Off Contributions, Form AR1100CO, if applicable Arkansas approved extension, if applicable Arkansas Reconciliation Schedule, Form AR1100REC Business incentive Tax Credit Certificate (original) if any, Form AR1100BIC, if applicable Copy of Federal Return with supporting schedules All other schedules pertaining to the Arkansas return Corporations with Filing Status 4 (Consolidated Return) must complete a separate AR1100CT and Schedule A, if applicable, for each member with gross income from sources within Arkansas and consolidate the applicable taxable income on a Consolidated Group AR1100CT and attach a copy of the Federal return. Each member’s Arkansas Business Incentive Tax Credit may be combined to reduce the consolidated group’s total tax liability without separate entity restrictions, except for the Arkansas Economic Development Credit and ArkPlus Credit. Charitable contribution limits are calculated on a separate corporation basis for consolidated filers. All percentages used in determining the apportionment factor on Schedule A must be calculated to 6 places to the right of the decimal (example 35.333452%). Estimated Tax Requirements ACA 26-51-911(c)(1) and ACA 26-51-913(a)(2) adopt federal due dates for making declarations of estimated Arkansas income tax. Arkansas taxpayers are required to file an Estimated Declaration when their liability exceeds $1,000. The AR1100ESCT, Estimate Payment Vouchers 1 through 4, and Extension Voucher 5 for tax year 2020 are not included in these instructions. You will find them at our website, www.dfa.arkansas.gov. Filling the forms out online will automatically fill in the taxpayer information and provide the appropriate scan line needed for proper processing. To make sure payments are processed correctly, please use the correct payment voucher. Use the AR1100ESCT vouchers for Corporation Income tax payments. For Individual Composite payments use the AR1000CRES vouchers. ACA 26-19-106 provides that a corporation with an estimated quarterly income tax liability equal to or greater than $20,000.00 must pay the estimated quarterly income tax due by electronic funds transfer (Refer to General Instructions). Corporations that underestimate their corporate tax liability must calculate any penalty due as applicable, on Part 2 of Form AR2220, and enter the penalty amount on page 1, Line 45 of Form AR1100CT. Enter the numerical exception from Part 3 in the box on Line 45 if applicable. If a corporation is required to remit Arkansas estimated corporation income tax payments through the Electronic Funds Transfer (EFT) method, ACA 26-19-107 authorizes the assessment of an EFT penalty equal to five percent (5%) based on the amount of taxes due. Taxpayers who are required to pay by EFT will be notified in writing by the Department. The Form EFT-CT is no longer used to register for EFT payments. You will find current instructions at https://www.dfa.arkansas.gov/excise-tax/sales-and-use-tax/electronic-filing-and-paymentoptions/ or by calling Excise Tax at (501) 682-7105. Page 7 Copy of Federal Return is Required ACA 26-51-806(d)(1) requires a completed copy of the corporation’s Federal Corporate Income Tax Return, Form 1120, 1120S, or other form, along with all schedules and documents, be attached to the Arkansas “C” Corporation Income Tax Return, Form AR1100CT. The Federal return may be submitted by CD, PDF, TIF format, or attached in paper form. Signatures and Verification The return must be signed by a corporate officer in the space provided on the bottom of Schedule A, page 2 of Form AR1100CT. The return of a foreign corporation having an agent in the State may be sworn to by such agent. If receivers, trustees in bankruptcy, or assignees are operating the property or business of the corporation, such receivers, trustees, or assignees shall sign the return for such corporation under certification. The return must be signed in the space provided on the bottom of Schedule A, page 2 of Form AR1100CT. For consolidated returns, only the group Form AR1100CT, Schedule A, page 2, must be signed. Refer to General Instructions. Page 8 2020 State of Arkansas Domestic and Foreign Income Tax General Instructions Who Must File Every corporation organized or registered under the laws of this State, or having income from Arkansas sources as defined in ACA 26-51-205, must file an income tax return. Consolidated returns are permitted under certain conditions. D.I.S.C and F.S.C. Corporations are treated as regular business corporations. Business corporations, D.I.S.C, and F.S.C. Corporations should use Arkansas Form AR1100CT. Small business “S” corporations must use Form AR1100S. Financial institutions must check the appropriate filing status box on the Form AR1100CT or AR1100S. A pass-through entity filing as an LLC or Partnership, or a pass-through entity electing to file as a corporation, should check the box on Form AR1100CT. (Refer to ACA 4-32-1313 or ACA 26-51-802.) Consolidated Returns All corporations that are eligible members of an affiliated group filing a Federal Consolidated corporation income tax return may elect to file an Arkansas Consolidated income tax return. However, only corporations in the affiliated group that have gross income from sources within the State that is subject to Arkansas income tax are eligible to file consolidated income tax returns in Arkansas. An Arkansas consolidated group with its members having business activity only within Arkansas must check the box for Filing Status 4. In computing Arkansas consolidated taxable income or loss to which the tax rate is applied, the separate net income or loss of each corporation that is entitled to be included in the affiliated group will be included in the consolidated net income or loss to the extent that its net income or loss is separately apportioned or allocated to Arkansas. All corporations in the affiliated group that are eligible to file an Arkansas Consolidated corporation income tax return must consent to, and join in, the filing of the return prior to the last day for filing. The filing of the consolidated return will be considered as consent of each eligible corporation in the affiliated group. Corporations with Filing Status 4 (Consolidated Return) must complete a separate Form AR1100CT reflecting taxable income before intercompany eliminations and adjustments, and Schedule A, if multistate, for each member with gross income from sources within Arkansas. Each member’s separate net income or loss must be consolidated on a group Form AR1100CT beginning on Line 30. Schedule A should not be completed for the consolidated group, but must be included for signature by a corporate officer. A complete copy of the Federal return must be attached. A schedule listing each intercompany elimination and adjustment, identifying the entity by FEIN to which it applies must be submitted if this information is not clearly shown on the Federal return. Time For Filing Arkansas adopted a new due date for Corporate Income tax returns for tax years beginning on or after January 1, 2016. Arkansas Corporate Income Tax Returns are now due the 15th day of the 4th month following the end of the tax year. This includes short tax years. Cooperative Association returns are due on or before the 15th day of the 9th month following the close of the tax year. Exempt organizations are due on the 15th day of the 5th month. Extensions of Time for Filing If you have received an automatic Federal extension (Form 7004), the time for filing your Arkansas Corporation Income Tax Return shall be extended until the due date of your federal return. When filing the Arkansas Form AR1100CT, check the box at the top indicating that the Federal Extension Form 7004 and/or Arkansas Extension Form AR1155 has been filed and file the Arkansas return on or before the extended due date. It is no longer necessary to include a copy of the Federal Form 7004. To request an initial Arkansas extension of 180 days from the original Arkansas return due date or an Arkansas extension of 60 days beyond the automatic federal extension due date, complete and mail Arkansas Form AR1155 by the federal extended due date or, if applicable, the Arkansas extended due date to the Corporation Income Tax Section. If you have an automatic federal extension and do not want to request an additional 60 day Arkansas extension, you do not fill out the Form AR1155. Extensions using Form AR1155 are only available for the filing of original returns. Approved Arkansas extension(s) must be attached to the Arkansas income tax return when it is filed. Submit payment with the AR1155 Voucher that is attached to the form only if you are requesting an Arkansas Extension, unless paying by EFT method. Page 9 Amended Returns Filing Declaration of Estimated Income Tax For tax years beginning on or after January 1, 2010 the AR1100CTX Arkansas Amended Return form was removed. An Arkansas Amended Return will be filed on the AR1100CT by checking the appropriate box as filing an Amended Return. Taxpayers should use AR1100CTX for tax years 2009 and prior. A copy of the corporation’s Federal Amended Return, or IRS audit report, or an explanation for filing the Arkansas Amended Return must be attached to the AR1100CT. Arkansas amended returns must be filed within three (3) years from date of filing the original return, or two (2) years from date of payment of tax on the original return, whichever is later, except when required to report the final results of an IRS audit. Refund requests must be filed on the amended return. Attach schedules and an explanation for filing the Arkansas amended return to the AR1100CT. If multistate, attach amended apportionment schedule. If consolidated, attach separate company amended AR1100CT with amended apportionment schedule, if applicable. Interest at 10% per annum will be computed on a daily rate of .00027397 from the original return due date to date amended return is filed and the tax is paid. Every taxpayer who can expect to owe Arkansas income tax in excess of $1,000 must make a declaration and the timely pay the estimated tax in equal installments. The declaration shall be filed with the commissioner on or before the 15th day of the 4th month of the tax year of the taxpayer. Taxpayers, whose income from farming for the tax year can reasonably be expected to amount to at least two-thirds (2/3) of the total gross income from all sources for the tax year, may file such declaration and pay the estimated tax on or before the 15th day of the 2nd month after the close of the tax year or the taxpayer may file an income tax return and pay the tax on or before the 15th day of the 4th month after the close of the tax year. To avoid penalty, all other taxpayers must pay quarterly estimates on or before the 15th day of the 4th month, 6th month, 9th month and 12th month of the tax year. The Form AR1100ESCT, Estimate payment vouchers 1 through 4 and Extension payment voucher 5 are not included in these instructions. Filling out the forms on our website, www.dfa.arkansas.gov, will automatically fill in the taxpayer information and provide the appropriate scan line needed for proper processing. Report of Change in Federal Taxable Income Corporations may remit estimated and extension corporation income tax payments through ATAP (Refer to www.atap.arkansas.gov for instructions). An agreed Revenue Agent’s Report (RAR) must be reported on an amended return using the appropriate Form AR1100CT or AR1100CTX (refer to Amended Return instructions). The RAR must be reported to this State within 180 days after the receipt of the RAR or supplemental report reflecting correct net income of taxpayer. ACA 26-18-306(b)(1-3) states that a refund shall not be paid if the amended return is filed on or after the 181st day following receipt of the notice from the IRS. Any additional tax and interest must be paid with the amended return or a refund must be requested on an amended return if applicable. Statute of limitations will remain open for three (3) years for assessment of tax if a taxpayer fails to disclose Federal Revenue Agent’s Report. Period Covered A taxpayer must calculate their Arkansas income tax liability using the same income year for Arkansas income tax purposes as used for Federal income tax purposes (ACA 26-51-402). Arkansas Regulation 1.26-51102(17)(B) states, A fractional part of a year (short tax year) means a period of less than twelve (12) months. If a short tax year ends on or before the 15th day of the month, then the short tax year shall be deemed to have ended on the last day of the previous month. If a short tax year ends on or after the 16th of the month, then the short tax year shall be deemed to have ended on the last day of the current month. Page 10 If the Director determines that a corporation’s estimated quarterly Arkansas income tax liability exceeds $20,000.00, the corporation is required to pay the estimated quarterly income tax payments due by electronic funds transfer (EFT). The EFT must be made no later than the day before each quarterly due date. If the corporation timely pays the estimated quarterly income tax payments by EFT, the corporation is not required to file a quarterly estimated income tax voucher. If a taxpayer is required to submit estimate payments by EFT, a letter will be sent by DFA notifying the taxpayer of the requirement. Accounting Methods A taxpayer must calculate their Arkansas income tax liability using the same accounting method for Arkansas income tax purposes as used for Federal income tax purposes. If a corporation changes its accounting method, attach a copy of any certification or approval received from the Internal Revenue Service authorizing the change of accounting method to the corporation’s Arkansas return.(ACA 26-51-401). Payment of Taxes Balance Sheets The tax should be paid by attaching to the return a check or money order payable to the order of “Department of Finance & Administration.” Enclose proper payment voucher with all remittance checks and write the corporation’s FEIN or CIT account ID number and the tax year on the check. Payments with returns may not be made by EFT. Tax due on returns may be paid through ATAP. (Refer to www.atap.arkansas.gov.) To avoid interest and/or penalty the tax must be paid in full by the original return due date, which is the 15th day of the 4th month after the close of the corporation’s tax year. An approved federal and/or state extension, which allows the corporation’s return to be filed on or before the approved extended due date, does not extend the time period to pay the tax due in full. Interest and/or penalty will be assessed on any tax due paid after the original return due date as referenced above. Payments with a return should include the AR1100CTV payment voucher for Corporation Income tax payments and the AR1000CRV for Individual Income tax. The balance sheet submitted with the return should be prepared from the books and should agree therewith. If there are any differences between current year beginning and prior year ending balance sheets, submit a schedule of reconciliation with the return. All corporations engaged in an interstate and intrastate trade or business and reporting to the Surface Transportation Board, or to any national, state, municipal or other public officer, may submit copies of their balance sheet, prescribed by said Board, national, state or municipal authorities, as of the beginning and end of the taxable year. Penalties and Interest The following penalties shall be imposed:(ACA 26-18208) Failure to file timely - 5% per month not to exceed 35%. Failure to make timely remittance - 5% per month not to exceed 35%. Underestimate penalty - 10% of the amount of the underestimate. Failure to file return - $50.00. Failure to make required EFT payment - 5% of the tax due. Incomplete electronic payment -10% of the amount of the draft or $20.00, whichever is greater. Failure to Comply - $50.00. If any part of any deficiency or tax liability is due to negligence or intentional disregard of rules and regulations, a penalty of 10% of the total amount shall be added. Any part of any deficiency determined to be due to fraud shall be subject to a 50% penalty. Interest at the rate of 10% per annum shall be assessed on all tax deficiencies. Interest will be computed using a daily rate of .00027397 from the 15th day of the 4th month after the close of the tax year until the date the tax is paid. Page 11 General Instructions Specific Line Instructions for Page 1 of AR1100CT Return Type Return Deductions Whether the C Corporation is filing an Initial Return (first time filing), an Amended Return (making changes to an original return), a Final Return (going out of business), or filing as a Cooperative Association or Financial Institution, clearly mark the AR1100CT by checking the applicable box at the top of the form. Line 13-Gains or Losses: Enter the total net gain or loss. Capital loss is reported in the tax year in which it is incurred. Gains and Losses must be adjusted to indicate any difference in Arkansas and federal basis. ACA 26-51406 adopts Internal Revenue Code Section 1400Z-2 as in effect on January 1, 2018 for tax years beginning on or after January 1, 2018 regarding opportunity zones. To claim an exemption for capital gains as a result of the sale of property located in an opportunity zone for Arkansas income tax purposes, the property must be located in an opportunity zone located in Arkansas. Opportunity zone gains for property located in other states are taxable in Arkansas. Income Line 7-Gross Sales: Enter the gross sales, less goods returned, and any allowances or discounts from the sale price. Line 8-Less Cost of Goods Sold: Enter the cost of goods sold. If the production, purchase, or sale of merchandise is an income producing factor in the trade or business, inventories of merchandise on hand should be taken at the beginning and end of the taxable year, which may be valued at cost or market, whichever is lower. Fully explain the method used. In case the inventories reported on the return do not agree with those shown on the balance sheet, attach a statement explaining how the difference occurred. Line 9-Gross Profit: Enter the gross profit which is obtained by deducting Line 8 from Line 7. Line 10-Dividends: Enter taxable dividends only. Dividends from 80% or greater directly owned subsidiaries are exempt. Line 11-Taxable Interest: Enter interest income taxable in Arkansas. Enter amounts received or credited as interest to the corporation during the tax year on bank deposits, C.D.’s, notes, mortgages, corporation bonds, taxable U.S. interest, and all other interest including interest on out-of-state municipal bonds (out-of-state municipal bonds are taxable in Arkansas). Attach schedule to the Arkansas return identifying each U.S. Agency or political subdivision of Arkansas and Schedule AR1100REC to reconcile amounts received that are not included as taxable interest on the Arkansas return. Line 12-Gross Rents/Gross Royalties: Enter all gross rents and royalties. Attach schedule showing amounts received from rents and royalties separately, if not shown separately on federal return. The schedule should reconcile Arkansas and federal rents and royalties. Page 12 Line 14-Other Income: Enter all other taxable income for which no place is provided on the return. The holder of the ownership interest in a Financial Asset Securitization Investment Trust (FASIT) must list the net income from prohibited transactions on this line. Attach schedule explaining all items included. Line 15-Total Income: Enter the net amount of Lines 9 through 14 inclusive. Line 16-Compensation of Officers/Other Salaries and Wages: Enter the compensation of all officers and employees, in whatever form paid. Attach a schedule showing amounts paid to officers and employees separately, if not shown separately on the federal return. The schedule should reconcile Arkansas and Federal compensation of officers and employees. Line 17-Repairs: Enter the amount of repair costs for business property. Line 18-Bad Debts: Enter debts which have been definitely ascertained to be worthless and have been charged off within the year. The Reserve Method for computing and deducting bad debts on receivables may be used only by small banks and thrift institutions. A debt previously charged off as bad, if subsequently collected, must be reported as income for the year in which collected. Line 19-Rent on Business Property: Enter rent paid for business property. Line 20-Taxes: Enter taxes paid or accrued during the taxable year. Do not include Arkansas or federal income taxes or taxes assessed against local benefits tending to increase the value of the property assessed. Attach Schedule AR1100REC to the AR1100CT to reconcile federal and Arkansas taxes. Line 21-Interest: Enter interest paid on business indebtedness. Line 22-Contributions: Enter the Arkansas allowable amount for charitable contributions. Title 26 U.S.C.170 as in effect on January 1, 2018, regarding deductions for charitable contributions, is adopted for the purpose of computing Arkansas income tax liability with the exception of the carryforward period. A five (5) year carryforward period is allowed and is carried over separately from the NOL. No carryback of contributions is allowed. The Arkansas contribution deduction allowable will be calculated using Arkansas taxable income rather than Federal taxable income. The contribution limits are calculated on a separate corporation basis for consolidated filers. (ACA 26-51-419)(a)(1) Line 27-Total Deductions: Enter the total of Lines 16 through 26 inclusive. Note: Expenses of Earning Tax Exempt Income ACA 26-51-431(c) provides that no deductions shall be allowed for interest on indebtedness incurred or continued to purchase or carry obligations the interest on which is wholly exempt from the taxes imposed by Arkansas law; expenses otherwise allowable as deductions which are related to tax exempt income other than interest; expenses otherwise allowable as deductions which are related to non-business income. Example a: (interest expense): disallowed avg. non-tax assets avg. total assets X interest expense = expense Example b: (non-business income): Line 23-Depreciation: Enter depreciation expense claimed. ACA 26-51-428 did not adopt the bonus depreciation provisions contained in Internal Revenue Code 168(k). The following IRC Code was adopted: Sections 167,168(a)-(j) of the IRS Code of 1986 as in effect on January 1, 2019, and Section 179 as in effect on January 1, 2009 for property purchased in tax years beginning or after January 1, 2014. For tax years beginning on or after January 1, 2011, the Arkansas Section 179 expense election is $25,000 with phase out beginning at $200,000. Attach Arkansas Schedule AR1100REC to the AR1100CT to reconcile Federal and Arkansas depreciation. Line 24-Depletion: Enter depletion claimed. Arkansas allows Federal depletion allowances as in effect January 1, 2019. In computing the depletion allowance deduction allowed for oil and gas wells, the depletion deduction shall be controlled by the provisions of IRC Section 613A as in effect on January 1, 2019. (A) Net operating losses must be carried over to the next succeeding taxable period and annually thereafter for a total period of eight (8) tax periods succeeding the year of such net operating loss or until such net operating loss has been exhausted or absorbed by the taxable income of any succeeding year, whichever is earlier. Line 25-Advertising: Enter amount for business advertising. Line 26-Other Deductions: Enter other deductions authorized by law. Attach schedule explaining all items included. Pension Profit Sharing and Employee Benefits deductions remain valid deductions. Those lines were removed from Form AR1100CT to allow other modifications. % X non-bus. inc. = disallowed expense Taxpayer must justify % used and submit schedule. State may increase % if justification can be made. Line 28-Taxable Income Before Net Operating Losses: Enter the amount from subtracting Line 27 from Line 15. Line 29-Net Operating Losses: Enter on line 29, or Schedule A, Part C, Line 3, net operating losses being claimed, but do not exceed net taxable income on the return. Losses must be carried forward under the following conditions:(Attach AR1100NOL form) (B)For computing the amount of NOL that will be allowed for carryforward purposes, there shall be added to gross income all nontaxable income, not required to be reported as gross income by law, less any related expenses which will otherwise be nondeductible. Multistate tax filers must follow above procedures and apportion NOL by the apportionment formula for year of loss, applying the Arkansas percentage factor for the year of loss against total apportionable loss for that year. Failure to provide a complete schedule of net operating losses (with the return) may result in disallowance of any NOL claimed. Page 13 Carryback of NOL is not allowed. Contributions are not to be added to NOL and carried forward. Net operating losses of a corporation which merges into another corporation will be allowed under the following conditions: Line 40-Amount Applied to Check Off Contributions: Enter amount applied to Check Off Contributions; attach AR1100CO. Line 41-Amount to be Refunded: Enter amount to be refunded (Line 38 less Lines 39 and 40). (1) The acquiring corporation must own at least 80% of the acquired corporation’s voting stock, and Line 42-Tax Due: Enter the tax due (Line 33 less Line 34 and 35; and Line 36 plus or minus Line 37). (2) Assets of the merged corporation must earn sufficient profits in the post-merger period to absorb the carryover losses claimed by the surviving corporation. Attach schedules of proof and computations to the return on which any NOL is being carried forward. Line 43-Interest on Tax Due: Enter the interest on tax due. Line 30-Net Taxable Income: Enter the amount of taxable income (Line 28 less Line 29 or Schedule A Line C4 on page 2). (If Amended Return box checked, enter amended net taxable income). Line 31-Tax from Table: Enter Tax from Table (pages 32-33). Line 32-Business Incentive Credits: Enter Business Incentive Credits. Attach AR1100BIC and original certificates. Line 33-Tax Liability: Enter Tax Liability. (If Amended Return box checked, enter amended tax liability.) (Line 31 less Line 32) Line 34-Estimated Tax Paid: Enter Estimated Tax paid, including estimate carryforward from prior year. Line 35-Payment with Extension Request: Enter payment made with extension request. Line 36-Withholding Payment: Enter amount of withholding from a partnership, if applicable, attach Form AR1100-WH and AR1099PT. Line 37-Amended Return Only: Enter Net tax paid (refunded or carried forward) on previous return(s) for this tax year. Line 38-Overpayment: Enter Overpayment amount (Line 34 plus Line 35 plus Line 36; plus or minus Line 37, less line 33). Line 39-Amount Applied to 2020 Estimated Tax: Enter amount applied to 2020 estimated tax. Page 14 Line 44-Penalty for Late Filing or Payment: Enter the penalty for late filing or payment amount. Line 45-Penalty for Underpayment of Estimated Tax: Enter the penalty for underpayment of Estimated tax, attach AR2220 and enter exception checked in Part 3. Line 46-Amount Due: Enter the amount due (add Lines 42 through 45). General Instructions For Taxpayers with Income from Sources Within and Without the State Multistate corporations should complete lines 30-46 of page 1, and Schedule A on page 2 of Form AR1100CT. Multistate corporations should not complete lines 7-29 of Form AR1100CT. Business Income is defined in ACA 26-51-701(a) as income arising from transactions and activity in the regular course of the taxpayer’s trade or business and includes income from tangible and intangible property if the acquisition, management, and disposition of the property constitute integral parts of the taxpayer’s trade or business operations. In essence, all income which arises from the conduct of trade or business operations of a taxpayer is business income. Income of any type or class and from any source is business income if it arises from transactions and activity occurring in the regular course of a trade or business. In general, all transactions and activities of the taxpayer’s economic enterprise as a whole constitute the taxpayer’s trade or business and will be considered “Business Income”, unless otherwise excluded by Arkansas law. ACA 26-51-701(e) defines Nonbusiness income as all income other than business income. Unitary Determination of Intangible Income Interest, dividends (less than 80% directly owned), rents, royalties, gains, and losses from multistate corporations are apportionable to Arkansas if a unitary business relationship exists between the intangible income and the State of Arkansas. Generally, a unitary business relationship will exist when an activity conducted in one state benefits and is benefited by an activity conducted in another state. Financial Institutions must use the single weighted sales factor. Construction companies, pipelines, publishing companies, railroads, and TV and radio broadcasters must utilize the double weighted sales factor apportionment method with factor modifications. Requirements for apportionment formulas of the businesses listed in this paragraph (except for financial institutions) are contained in the Arkansas Corporation Income Tax Regulations which may be obtained from www.dfa.arkansas.gov/income-tax/corporation/. Change of Method Prior approval Required Before Deviation From the Allocation and Apportionment Method: If the allocation and apportionment provisions as set out above do not fairly represent the extent of the taxpayer’s business activity in this State, the taxpayer may petition for, or the Commissioner of Revenue, Department of Finance and Administration may require in respect to all or any part of the taxpayer’s business activity, if reasonable: A) Separate accounting B) The exclusion of any one or more factors; C) The inclusion of one or more additional factors which will fairly represent the taxpayer’s business activity in this State, or D) The employment of any other method to effectuate an equitable allocation and apportionment of the taxpayer’s income. Apportionment Formula To “petition for” and approved by DFA shall mean a formal written request submitted and approved prior to the filing of a return. In general, taxpayers with income derived from activities both within and without the State are required to apportion Business Income and allocate the Nonbusiness and Partnership income using the following factors: Schedule A-Apportionment of Income for Multistate Corporation All multistate corporations except Financial Institutions apportion business income to this State by multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor, plus double the sales factor, and the denominator of which is four (4). If a taxpayer does not have all four (4) factors, the denominator shall be the same as the number of entries other than zero (0) that apply to the total (everywhere) amounts of the property, payroll and sales factors. When double weighted, the sales factor counts as two (2). Part A - Income To Apportion Line 1: Enter federal taxable income before any adjustments, net operating losses, or special deductions from Line 28 of the federal Form 1120. If federal Form 1120 is not filed, use the appropriate line from the federal form that is filed that reflects taxable income before adjustments, net operating loss, and special deductions. Enter the FEIN in the box provided. Page 15 Line 2: Enter any Add Adjustments. Examples Include: Line c: For Financial Institutions Only, refer to ACA 26-51-1404 Enter Average Value of Intangible Property in Arkansas Corporation Income Taxes Deducted, Bonus Depreciation, Federal Charitable Contributions, and Column A and B. (Attach schedule) Partnership Loss. (Attach detailed schedule) Line d: Enter Total Property in both Columns: (Add Line 3: Enter any Deduct Adjustments. Examples Lines a.4, b and c). include: Arkansas Depreciation, Arkansas Charitable Contributions, Partnership Income. (Attach detailed In Column C, calculate the Arkansas percent by dividing schedule) the amount on Line d, Column A by the amount on Line d, Column B. Line 4: Enter Arkansas Total Apportionable Income. Line 1 + Total Amount from Line 2 - Total Amount from Payroll Factor: The payroll factor is a fraction, the Line 3 = Line 4, Total Arkansas Apportionable Income. numerator of which is the total amount paid in this State during the tax period by the taxpayer for compensation Note: Lines 2 and 3 are for reporting any adjustments and the denominator of which is the total compensation to taxable income that result in differences between paid everywhere during the tax period. The payroll factor Federal and Arkansas tax laws. The examples listed shall include only that compensation which is included above are not intended as an all-inclusive list of in the computation of the apportionable income tax base for the taxable year. (ACA 26-51-713 and ACA 26-51required adjustments. 1405) Part B - Apportionment Factor Column A is total compensation paid within Arkansas; Column A is for Amounts in Arkansas; Column B is Column B is total compensation paid everywhere during the Total Everywhere; Column C is the Percentage the tax year; Column C is the percentage of Column (A) of Column (A)÷(B). Calculate all percentages to six ÷ (B). (6) places beyond whole percentages. Example 26.123456% Line 2: Enter Salaries, Wages, Commissions and Other Compensation Related to the Production of Property Factor: The property factor is a fraction, the Business Income. numerator is the average value of the taxpayer’s real and tangible personal property owned or rented and used in Sales/Receipts Factor: The receipts factor is a fraction, this State during the tax period, and the denominator is the numerator of which is the total sales of the taxpayer the average value of all the taxpayer’s real and tangible in this State during the tax period, and the denominator personal property owned or rented and used during the of which is the total sales of the taxpayer everywhere tax period. (ACA 26-51-710) during the tax period. The method of calculating receipts for purposes of the denominator is the same as the Line 1: Enter Property Used in Business method used in determining receipts for purposes of the numerator. The receipts factor shall include only those Line a: Tangible Assets Used in Business and receipts which constitute business income and are Inventories. included in the computation of the apportionable income (a1) Enter the amount at the beginning of the year in base for the taxable year. Arkansas requires receipts both Column A and Column B. to be gross receipts instead of net receipts. Financial institutions cannot double weight the sales/receipts (a2) Enter the amount at the end of the year in both factor. (ACA 26-51-715 and ACA 26-51-1403). Column A and Column B. Line 3: Sales/Receipt (a3) Enter total amounts: (Add Lines a1 and a2) in both Columns. (a) Enter Destination Shipped from Within Arkansas: Sale of property that is delivered or shipped by a seller (a4) Enter Average of Tangible Assets: (Line 3 ÷ 2) in located in Arkansas to a purchaser located in Arkansas. both Columns. (b) Enter Destination Shipped from Without Arkansas: Line b: Enter Rental Property: (8 times annual rent Sale of property that is delivered or shipped to a purchaser Column A and B. located in Arkansas regardless of the f.o.b. point or other conditions of the sale. Page 16 (c) Enter Origin Shipped from Within Arkansas to U.S.Govt.: Gross receipts from sales of tangible personal property to the United States Government are in this state if the property is shipped from an office, store, warehouse, factory, or other place of storage in this state and the purchaser is the U.S. Government. (d) Enter Origin Shipped from Within Arkansas to Other Non-Taxable Jurisdictions: Sales of property that is shipped from an office, store, warehouse, factory or other place of storage in Arkansas to a taxpayer that is not taxable in the state of the purchaser. (e) Enter Other Gross Receipts: Includes items such as interest income, other income, proceeds from sales of assets, rental income. (Attach schedule) Gross receipts from transactions other than sales of tangible personal property are attributed to Arkansas if: 1) The income producing activity is performed entirely within Arkansas or, 2) If the income producing activity is performed both inside and outside of Arkansas, the income reportable to Arkansas is determined by calculating the property, payroll, and sales factor excluding sales from transactions other than the sale of tangible personal property and applying the resulting percentage to the Arkansas sales factor numerator for gross receipts from transactions other than sales of tangible personal property. (f) Enter Total Sales/Receipts: (Add Lines 3a through 3e). Divide Line 3f in Column A by Line 3f in Column B to arrive at the percentage for Line 3f in Column C. (g) Enter Double Weighted: (Applies to tax years beginning on or after January 1, 1995) (Financial Institutions must use Single Weighted Factor, Column C, Line 3f X 2). Line 4: Enter Sum of Percentages: (Single Weighted: Add Column C, Lines 1d, 2a and 3f) (Double Weighted: Add Column C, Lines 1d, 2a and 3g). Line 5: Enter Percentage Attributable to Arkansas: Line 4 divided by the Single/Double Weighted Factor. For Part B, Line 5, divide Line 4 by number of entries other than zero which you make on Part B, Column B, Lines (1d), (2a), and (3f). Also any entry other than zero in Part B, Column B, Line (3f), counts as two (2) entries unless using Single Weighted Factor. Part C - Arkansas Taxable Income Line 1: Enter Income Apportioned to Arkansas. (Part A, Line 4) x (Part B, Line 5, Column C). Line 2: Enter Direct Income Allocated to Arkansas: Include non-business income and partnership income/ loss that are sourced to Arkansas. Arkansas Regulation 1.26-51-802(b) requires corporations to directly allocate partnership Arkansas income or loss to Arkansas rather than including partnership income and apportionment factors in the corporation’s apportionment formula. Multistate corporations with partnership income should deduct all partnership income on Part A, Line 3 (Deduct Adjustments). Partnership losses should be added on Part A, Line 2 (Add Adjustments). The corporation’s Arkansas partnership income or loss should then be entered on Part C, Line 2 Add: Direct Income Allocated to Arkansas line. Attach Forms ARK-1 and if claiming withholding, attach Forms AR1099PT. Line 3: Enter only the amount of Apportioned NOL available or the amount needed to absorb the total of Lines 1 and 2 on Part C. (Attach Form AR1100NOL). Example: Line C1=$1000 + Line C2=$500 NOL available is $5000; Line C3 will only show $1500 Line 4: Enter Total Income Taxable to Arkansas: Total of Lines C1, C2, and C3. (Enter here and on Line 30, page 1) Special Industry Apportionment Rules Arkansas Regulations require taxpayers primarily engaged in certain industries to apportion income using a special industry apportionment method. See below for a brief description of each special industry apportionment method. For a complete description of industries that are required to modify their apportionment factors, see the Corporation Income Tax Regulations at www.dfa.arkansas.gov. Construction Contractors Arkansas Regulation 1.26-51-718(d) modifies the property factor to include the average value of construction in progress. It also modifies the payroll factor to include compensation paid for particular construction projects and compensation “thrown back” to Arkansas if not reported to another state. The sales factor is modified for the percentage of completion method. Television and Radio Broadcasting Arkansas Regulation 2.26-51-718(d) modifies the property factor to exclude outer-jurisdictional, film and radio transmission property from the numerator and denominator of the property factor. The numerator of the sales factor shall include all gross receipts of the taxpayer from sources within Arkansas plus a ratable part of film Page 17 or radio programming revenue including advertising revenue determined by an audience factor. The audience factor is determined based on the ratio that the taxpayer’s Arkansas viewing or listening audience bears to its total viewing or listening audience. Publishing Arkansas Regulation 3.26-51-718(d) modifies the apportionment factors for taxpayers in the business of publishing, selling, licensing or distribution of books, newspapers, magazines, periodicals, trade journals, or other printed materials that have income from sources both inside and outside of Arkansas. Outer-jurisdictional property shall not be included in the property factor’s denominator. The sales factor is modified to include a “circulation factor”. Airlines Arkansas Regulation 4.26-51-718(d) requires airlines to determine Arkansas net taxable income by taking that portion of total operating revenue that the total passenger and freight receipts in Arkansas bears to total receipts from both inside and outside of Arkansas. The Arkansas and Total Passenger & Freight Receipts should be included on line 3.f. of Schedule A of Form AR1100CT with a notation that this represents Passenger & Freight Receipts. Bus Lines and Trucking Companies Arkansas Regulation 5.26-51-718(d) requires a company whose primary business is bus lines or trucking to determine its net income subject to Arkansas income tax by an apportionment formula which is the number of miles operated within Arkansas divided by the total system miles. The Arkansas and Total miles operated should be included on Line 3.f of Schedule A of Form AR1100CT with a notation that this represents mileage. Pipelines Arkansas Regulation 6.26-51-718(d) establishes special rules for taxpayers operating a pipeline for the transportation of oil or gas both inside and outside of Arkansas. The payroll factor includes compensation paid both inside and outside of Arkansas plus a ratable part for services performed both in and outside the State based on the total number of barrel or unit miles in Arkansas divided by the total barrel or unit miles system-wide. The sales factor includes any gas sales and storage sales within Arkansas plus a proportionate part of system revenue earned in Arkansas determined on the basis of total barrel or unit miles within Arkansas to the total barrel or unit miles in the system. Page 18 Railroads Arkansas Regulation 1.26-51-204 modifies the property, payroll, and sales factor to include a mobile component that is calculated based on miles operated in Arkansas divided by total system miles. Private Railcar Operators Arkansas Regulation 2.26-51-204 requires taxpayers, other than a railroad, engaged in the business of operating railcars or in the business of furnishing or leasing railcars for the transportation of freight or property whether or not owned by such taxpayer, over any railway lines partly within and partly without the State to determine Arkansas net taxable income by taking that portion of total net operating income that the total miles operating in the State bears to total system miles operated. Public Utilities Arkansas Regulation 3.26-51-204 requires telephone, electric power, and gas distribution companies operating both inside and outside of Arkansas shall allocate and apportion their net income provided under ACA 26-51-701. Allocated Income 2. Gain and Losses: Partnership Income Gains and losses from sales of assets: A) Sales of real property located in this State. Act 482 of 2017 amends ACA 26-51-802(c) to require partnership income from activites within and without this State that is reflected on a partnership return shall be apportioned to Arkansas under the uniform Division of Income for Tax Purposes Act (ACA 26-51-701 et seq). Corporations that are partners in a partnership must allocate their share of partnership income as shown on form ARK-1 from the partnership. Non-Business Income The following items of income to the extent that they do not constitute business income are to be allocated to this State. B) Sales of tangible personal property. 1) The property had a situs in this State at the time of sale, or 2) The taxpayer’s commercial domicile is in this State, or 3)The property has been included in depreciation which has been allocated to this State; in which event gains or losses on such sales shall be allocated on the percentage that is used in the formula for allocating income to this State. 3. Interest and Dividends: 1. Rents & Royalties: A) Net rents and royalties from real property located in Interest and dividends if the taxpayer’s commercial domicile is in this State. this State. B) Net rents and royalties from tangible personal 4. Patent and Copyright Royalties: property 1) If and to the extent that the property is used in A) If and to the extent that the patent or copyright is utilized by the taxpayer in this State, this State, or or 2) In their entirety, if the commercial domicile is in B) If and to the extent that the patent or copyright is utilized by the taxpayer in a state in which this State and the taxpayer is not organized under the taxpayer is not taxable and the taxpayer’s the laws of or taxable in the state in which the commercial domicile is in this State. property is utilized. The extent of utilization of tangible personal property in a state is determined by multiplying the rents and royalties by a fraction, the numerator of which is the number of days of physical location of the property in the State during the rental or royalty period in the taxable year; and the denominator of which is the number of days of physical location of the property everywhere during all rental or royalty periods in the taxable year. If the physical location of the property during the rental or royalty period is unknown or unascertainable by the taxpayer, tangible personal property is utilized in the state in which the property is located at the time the rental or royalty payer obtained possession. A copyright is utilized in a state to the extent that printing or other publications originate in the state. If the basis of receipts from copyright royalties does not permit allocation to states or if the accounting procedures do not reflect states of utilization, the copyright is utilized in the state in which the taxpayer’s commercial domicile is located. Apportionment of Intragroup Intangible Licensing Transactions: Regulation 1996-3 clarifies the calculation method for determining the sales factor in apportioning business income received from intragroup intangible licensing transactions. This regulation applies to a corporation that is a passive intangible holding company and receives business income from intragroup intangible licensing transactions with one or more members of the same group. Also, at least one of the other members of the same group from which the business income is received by the taxpayer must be subject to the Arkansas Income Tax Act. Page 19 The sales factor for intragroup intangible transactions is modified as follows: 1. If the licensing agreement states a method of measuring the activity between the licensor and licensee, the numerator of the sales factor is the amount of the sales or receipts received as provided in the licensing agreement. 2. If the licensing agreement does not state a method of measuring the activity between the licensor and licensee, the measuring activity will be based on one of the following: a. If the licensee’s activity generates sales or receipts, the numerator of the sales factor will be the percentage of sales in Arkansas compared to the licensee’s total sales, or b. If the licensee’s activity does not generate sales or receipts, the numerator of the sales factor will be the percentage of units produced or cost of units produced in Arkansas compared to the licensee’s total units produced or total cost of units produced, or c. If neither of the above methods accurately represent the licensor’s business activity in Arkansas, the licensor may petition for, or the Director may require, another method. 3. If the licensing agreement states a method of measuring the activity between the licensor and licensee in addition to a specifically stated dollar amount, the numerator of the sales factor will be the stated measuring activity plus the stated dollar amount attributable to Arkansas. This Regulation modifies the sales factor for intragroup intangible licensing transactions only. Business income from any other source should be apportioned in accordance with ACA 26-51-709. If a passive intangible holding company meets the above characteristics and the licensee elects to forego the intragoup intangible licensing transactions deduction, the passive intangible holding company will not be required to report the business income received from intragroup intangible licensing transactions for Arkansas income tax purposes. The licensee’s election to forego the deduction will be binding unless the licensee and the passive intangible holding company submit a written petition to change the election to the Director, and the Director approves the change. Page 20 Financial Institutions In general, all state and national banks, savings and loan, building and loan associations, or any other entity operating as financial institutions are to be taxed under existing law. For a complete definition of “financial institution”, refer to ACA 26-51-1402. Who Must File 1) A financial institution having its principal office in this State shall be taxed as a business corporation organized and existing under the laws of this State, or 2) A financial institution having its principal office outside this State, but doing business in this State, shall be taxed as a foreign business corporation doing business in this State. This is not intended to recognize the right of a foreign financial institution to conduct any business in this State except to the extent and under the conditions permitted by any acts or any other now existing applicable laws of this State. ACA 26-51-702 requires any taxpayer having income from business activity which is taxable both within and without this state, other than activity as a public utility or the rendering of purely personal services by an individual, shall allocate and apportion their net income. ACA 26-51-426 adopted Internal Revenue Code Sections 582, 585, and 593 as in effect January 1, 1999, regarding bad debts of financial institutions. ACA 26-51-1401 et seq. adopted the Multistate Tax Commission regulation regarding apportionment and allocation of net income of financial institutions. It requires that a financial institution whose business activity is taxable both within and without this State to allocate and apportion its net income to this State. All business income which is includable in the apportionable income tax base shall be apportioned to this State by multiplying such income by the apportionment percentage which is determined by adding the receipts factor, property factor, and payroll factor, and dividing the sum by three (3). Receipts Factor Generally, the receipts factor is a fraction; the numerator is the financial institution’s gross receipts in Arkansas during the taxable year, and the denominator is all gross receipts that the financial institution derives from transactions and activities in the regular course of its trade or business. Interest from loans secured by real property is attributed to Arkansas if the property is located in Arkansas. Interest from loans not secured by real property is attributed to Arkansas if the borrower is located in Arkansas. Interest from credit cards receivables and fees charged to card holders are attributable to Arkansas if the billing address of the card holder is in Arkansas. Net gains from the sale of loans and loan servicing fees are sourced in the same manner as the loan interest. Net gains from the sale of credit card receivables are sourced in the same manner as the interest on credit card receivables. Interest, dividends, and net gains from investment and trading assets and activities are attributed to Arkan
More about the Arkansas Form AR1100CTX Corporate Income Tax
Form no longer in use
We last updated the Corporation Income Tax Amended Return in May 2021, and the latest form we have available is for tax year 2019. This means that we don't yet have the updated form for the current tax year. Please check this page regularly, as we will post the updated form as soon as it is released by the Arkansas Department of Revenue. You can print other Arkansas tax forms here.
Other Arkansas Corporate Income Tax Forms:
|Form Code||Form Name|
|Form AR1000TC||Schedule of Tax Credits and Business Incentive Credits|
|Form AR1100S||Subchapter S Corporation Income Tax Return|
|Form AR1100CT||Corporation Income Tax Return|
|Form AR1100-REC||Reconciliation Schedule|
Arkansas usually releases forms for the current tax year between January and April. We last updated Arkansas Form AR1100CTX from the Department of Revenue in May 2021.
About the Corporate Income Tax
The IRS and most states require corporations to file an income tax return, with the exact filing requirements depending on the type of company.
Sole proprietorships or disregarded entities like LLCs are filed on Schedule C (or the state equivalent) of the owner's personal income tax return, flow-through entities like S Corporations or Partnerships are generally required to file an informational return equivilent to the IRS Form 1120S or Form 1065, and full corporations must file the equivalent of federal Form 1120 (and, unlike flow-through corporations, are often subject to a corporate tax liability).
Additional forms are available for a wide variety of specific entities and transactions including fiduciaries, nonprofits, and companies involved in other specific types of business.
Historical Past-Year Versions of Arkansas Form AR1100CTX
We have a total of nine past-year versions of Form AR1100CTX in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:
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While we do our best to keep our list of Arkansas Income Tax Forms up to date and complete, we cannot be held liable for errors or omissions. Is the form on this page out-of-date or not working? Please let us know and we will fix it ASAP.