Property Management Taxes In Arkansas

This guide covers the taxes that actually apply to a property management company operating in Arkansas, and to the rental income it handles on behalf of owners. Every figure below is tied to the statute, agency rule, or published guidance that sets it, so you can confirm a rate or deadline before acting on it.

Sales Tax On Rent: What Applies And What Does Not

Arkansas does not tax long-term residential rent. Arkansas gross receipts tax reaches accommodations only when they are furnished to transient guests, defined as people renting somewhere other than their regular place of abode on less than a month-to-month basis. Rentals that meet the month-to-month test are not taxable. Separately, the 1 percent Short Term Rental Tax is a tax on rentals of TANGIBLE PERSONAL PROPERTY, not on renting out a house, and confusing the two is a common error.

• Arkansas gross receipts tax applies to the service of furnishing rooms, suites, condominiums, townhouses, rental houses, or other accommodations to transient guests. Transient guests are those who rent accommodations other than their regular place of abode on less than a month-to-month basis. Rentals that meet the month-to-month criteria are not taxable. (26 CAR Section 30-501, authority Ark. Code Ann. Section 26-52-105)
• A rental qualifies as month-to-month, and therefore non-taxable, when three conditions are met: payment is in monthly installments, thirty days' termination notice is required, and the renter owes the full monthly rent regardless of early departure. If the renter can terminate without notice, or payments accrue daily or weekly, the rental stays taxable even if occupancy runs beyond 30 days. (26 CAR Section 30-501)
• The Arkansas state general sales and use tax rate is 6.500 percent, effective July 1, 2013. (Arkansas DFA, State Sales and Use Tax Rates)
• A 2.000 percent state Parks and Tourism tax, effective July 1, 1989, applies to lodging services in addition to state and local sales tax, so a taxable short-term stay carries the tourism tax on top of the 6.500 percent state rate and any local rates. (Arkansas DFA, State Sales and Use Tax Rates)
• The 1.000 percent Short Term Rental Tax, effective July 1, 1989, is collected by the lessor on short-term rentals of TANGIBLE PERSONAL PROPERTY, in addition to state and local sales or use tax. It is not a tax on renting real property. Short-term rentals of tangible personal property that are subject to the 2 percent tourism tax are exempt from the 1 percent short-term rental tax. (26 CAR Section 30-1404; Arkansas DFA, State Sales and Use Tax Rates)
• The state reduced food tax rate is 0.000 percent effective January 1, 2026. Food and food ingredients remain subject to city and county sales and use taxes. (Arkansas DFA, State Sales and Use Tax Rates and State Sales and Use Tax Rate Changes)

Property Tax

Arkansas county assessors value both real and personal property, and the assessed value is 20 percent of market value statewide. Amendment 79 provides the homestead property tax credit and caps on how fast taxable value can rise, but the credit requires the dwelling to be the owner's principal place of residence, so it is unavailable on tenant-occupied rentals. Rentals do get the Amendment 79 valuation cap, but at the 10 percent other-property rate rather than the 5 percent homestead rate.

• The Arkansas assessment rate is 20 percent of true, actual or market value. Assessed value is market value multiplied by 20 percent, and the millage rate is then applied to the assessed value. (Arkansas Assessment Coordination Division, Real Property)
• The county assessor's duty is to appraise and assess all real and personal property in the county between January 1 and May 31 each year. (Arkansas Assessment Coordination Division, Frequently Asked Questions)
• Personal property must be itemized and reported to the assessor by May 31 to avoid a late assessment penalty of 10 percent. (Arkansas Assessment Coordination Division, Frequently Asked Questions)
• Property taxes currently due are payable to the county collector by October 15 each year. (Arkansas Assessment Coordination Division, Frequently Asked Questions)
• The Amendment 79 homestead property tax credit is up to $500 per year and applies to the dwelling of a person used as their principal place of residence. Because a tenant-occupied rental is not the owner's principal residence, the credit does not apply to it. (Amendment 79 to the Arkansas Constitution; Arkansas Assessment Coordination Division, Property Tax Relief)
• Under Amendment 79 the taxable value of a homestead property can increase only 5 percent per year until it reaches full assessed value, while the taxable value of all other real property parcels, including commercial, agricultural and vacant land, can increase only 10 percent per year. Tenant-occupied rentals fall under the 10 percent cap, not the 5 percent homestead cap. (Amendment 79 to the Arkansas Constitution; Arkansas Assessment Coordination Division, Property Tax Relief)
• The Amendment 79 caps do not apply to newly discovered property, new construction, or substantial improvements, defined as renovations that add 25 percent or more to property value. Such property is assessed at full value. (Arkansas Assessment Coordination Division, Property Tax Relief)

Registration And Recordkeeping

Arkansas tax accounts are opened through the Arkansas Taxpayer Access Point. A sales tax permit is only needed if the manager handles taxable transient lodging or other taxable sales, and it carries a $50 fee. The bigger recordkeeping regime for property managers comes from the Arkansas Real Estate Commission, which classifies collected rents as trust funds and requires them to be handed to the principal broker and held in a trust account subject to inspection.

• Businesses register for Arkansas state tax accounts through the Arkansas Taxpayer Access Point (ATAP), a web-based service giving taxpayers or their representative online access to their tax accounts. (Arkansas DFA, Arkansas Taxpayer Access Point)
• Registering for an Arkansas sales tax permit requires supporting documentation, including a signed copy of the lease agreement if leasing the property, a signed copy of the bill of sale if equipment or inventory was purchased from a previous business, and the date operations will begin in Arkansas, plus a $50.00 sales tax permit fee paid electronically on submission. (Arkansas DFA, Register for a Tax Account)
• An Arkansas property management license requires 30 hours of property management education, including property management principles and practices, from an accredited post-secondary school or a school or organization licensed by the Arkansas Real Estate Commission. (Arkansas Real Estate Commission, Property Management Licensee Information)
• Trust funds include money or other things of value not belonging to the principal broker that are received in connection with a real estate transaction or real estate activity, including clients' moneys, earnest moneys, rents, advance fees and deposits. A licensee must immediately deliver to the principal broker any such money received. (Arkansas Real Estate Commission Regulations)
• All trust fund records, including bank reconciliations, must be open to inspection by and made available to the investigative staff of the Commission at the firm's office or another location the Commission designates. (Arkansas Real Estate Commission Regulations; AREC Trust Account Record Keeping Guide)

Recent Changes Worth Tracking

• Effective January 1, 2026: The Arkansas state reduced food tax rate dropped to 0.000 percent, so a taxpayer no longer pays state sales or use tax on purchases of food and food ingredients. Food and food ingredients continue to be subject to city and county sales and use taxes. (Arkansas DFA, State Sales and Use Tax Rate Changes)
• Effective Beginning with the 2026 tax bills: The Amendment 79 homestead property tax credit increases from up to $500 to up to $600 per year. It remains limited to the dwelling used as the owner's principal place of residence and is not available on tenant-occupied rental property. (Arkansas Assessment Coordination Division, Property Tax Relief)

This page is one half of the picture. See our guide to how Arkansas taxes rental and management income for the rest.

Keeping This Straight

Tax rates and thresholds move more often than most operators expect, and the figures circulating in older articles go stale quickly. Check any rate against its citation before you quote it to an owner, and re-check them at the start of each tax year.

This guide is a starting point for professional managers, not tax or legal advice. For a specific filing, work with a CPA familiar with Arkansas rental property, and confirm current figures with the Arkansas Department of Finance and Administration or the IRS.

Sources

Every fact above is drawn from one of the official sources below.

• 26 CAR Section 30-501, authority Ark. Code Ann. Section 26-52-105, Code of Arkansas Rules, Gross Receipts Tax Rules
• Arkansas DFA, State Sales and Use Tax Rates, Arkansas Department of Finance and Administration
• 26 CAR Section 30-1404; Arkansas DFA, State Sales and Use Tax Rates, Code of Arkansas Rules, Gross Receipts Tax Rules
• Arkansas Assessment Coordination Division, Real Property, Arkansas Department of Finance and Administration, Assessment Coordination Division
• Arkansas Assessment Coordination Division, Frequently Asked Questions, Arkansas Department of Finance and Administration, Assessment Coordination Division
• Amendment 79 to the Arkansas Constitution; Arkansas Assessment Coordination Division, Property Tax Relief, Arkansas Department of Finance and Administration, Assessment Coordination Division
• Arkansas DFA, Arkansas Taxpayer Access Point, Arkansas Department of Finance and Administration
• Arkansas DFA, Register for a Tax Account, Arkansas Department of Finance and Administration
• Arkansas Real Estate Commission, Property Management Licensee Information, Arkansas Real Estate Commission
• Arkansas Real Estate Commission Regulations, Arkansas Real Estate Commission
• Arkansas Real Estate Commission Regulations; AREC Trust Account Record Keeping Guide, Arkansas Real Estate Commission
• Arkansas DFA, State Sales and Use Tax Rate Changes, Arkansas Department of Finance and Administration