The Consolidated Incentive Act 182 of 2003, as amended, allows the Arkansas Economic Development Commission (AEDC) to provide a ten percent (10%) income tax credit to eligible businesses based on the total investment in a new location or expansion project. The ArkPlus Program requires a minimum investment and a minimum payroll based on the payroll of new full-time permanent employees hired after the date of a financial incentive agreement signed by AEDC. The minimum investment and payroll requirements are dependent upon the tier in which the business is located. Any unused credits may be carried forward for nine (9) years beyond the year in which the credit was first earned. The ArkPlus tax credits taken during any tax year shall not exceed fifty percent (50%) of the business’s income tax liability resulting from the project or facility.
Effective July 30, 2007, the ArkPlus incentive may also be awarded by AEDC as an optional income tax credit or sales tax credit to technology-based businesses that create a new payroll of at least $250,000 and pays wages at least 175% of the state or county average hourly wage, whichever is less. The percentage of credit earned shall be based on the level of investment, ranging from 2% to 8% of the investment costs. Depending on the average hourly wage paid by the company, the credits earned may be used to offset 50%, 75%, or 100% of the tax liability. Any unused credits may be carried forward for nine (9) years beyond the year in which the credit was first earned.
To claim the credits authorized under this program, attach to the tax return a copy of the Certificate of Tax Credit issued by Tax Credits/Special Refunds Section.
For information regarding application into the ArkPlus Program, contact Arkansas Economic Development Commission at (501) 682-1121 or visit their website at http://arkansasedc.com/