Updated October 4, 2026. Quick answer: No. Act 141 of 2017 amends the state income tax law so that “Retirement benefits received by a member of the” listed uniformed services are exempt, with survivor benefits funded by that pay, and no dollar cap or age is printed in the new subsection.
How Arkansas treats military retired pay
| Item | What the documents say |
|---|---|
| Treatment | Exempt from Arkansas income tax under new subsection (e) of Arkansas Code 26-51-307, as Act 141 of 2017 amends it |
| Who qualifies | A retired member of the Army, Marine Corps, Navy, Air Force, Coast Guard, a reserve component, any state’s National Guard, the Public Health Service commissioned corps or the NOAA Commissioned Officer Corps, plus survivor benefits funded by that retirement pay |
| One condition | A taxpayer claiming this exemption is not eligible for the $6,000 retirement exemption in subsection (a) |
| Cap or age | None printed in subsection (e) |
| Rate on other income | Not printed in the document read |
A $30,000 example
A retiree with $30,000 of military retired pay claims the subsection (e) exemption for the whole amount, so none of that pay is left to tax. The same retiree cannot also take the $6,000 retirement exemption.
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What changes in 2026
No 2026 change is printed in the documents read.
Federal rules
The state’s treatment sits on top of the federal one. The IRS explains the federal side in Publication 3, Armed Forces’ Tax Guide.
Related: whether Arkansas taxes pensions, how Arkansas taxes retirement income, military retirement pay by state, and the military retirement calculator.
Sources
- Act 141 of 2017 Regular Session (House Bill 1162, as engrossed): https://www.arkleg.state.ar.us/Acts/FTPDocument?path=%2FACTS%2F2017R%2FPublic%2F&file=141.pdf&ddBienniumSession=2017%2F2017R
Sources: the primary documents linked above, read on October 4, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.