To Amend The Arkansas Income Tax Withholding Act Of 1965; And To Require The Electronic Filing Of A Form 1099 In Certain Circumstances.
Summary
SB502 amends the Arkansas Income Tax Withholding Act of 1965 to add a new requirement for filing IRS Form 1099s with the Arkansas Department of Finance and Administration. Under the bill, any taxpayer subject to the state withholding requirements must file each Form 1099 on which that taxpayer is the payer with the Secretary of the Department of Finance and Administration.
The bill also sets a filing deadline of January 31 following the close of the income year in which the 1099 was issued. In addition, it requires electronic filing when the payer submits at least 1,000 Forms 1099 during the payer’s income year. The new requirement would apply to tax years beginning on or after January 1, 2026.
Impact
SB502 would expand state reporting obligations for certain taxpayers by requiring submission of federal information returns to the Arkansas Department of Finance and Administration. It would create a new state-level filing duty for payers already subject to Arkansas withholding rules and would shift high-volume filers to electronic reporting, likely affecting employers, businesses, payroll processors, and other entities that issue large numbers of 1099s. The bill does not change tax rates or withholding amounts, but it would add compliance and administrative requirements to Arkansas tax law.
Sentiment
The available record shows no committee transcript, vote history, or recorded debate, so there is no documented public sentiment in the materials provided. Based on the bill text alone, the measure appears administrative and technical rather than controversial, focusing on filing procedures and electronic reporting. There is no evidence in the record of support or opposition from legislators or stakeholders.
Contention
No specific points of contention are documented in the provided materials. Potential areas of concern, if raised, would likely involve compliance burden, the cost of converting to electronic filing, and the scope of taxpayers covered by the new reporting requirement. However, the record provided does not identify any member, agency, or outside group taking a formal position on those issues.