Arkansas Side Hustle Tax Calculator
Calculate your Arkansas state tax (3.90%), federal tax, and self-employment tax on 1099 income.
Last updated: January 2026 · Data from IRS Rev Proc 2024-40
Arkansas side hustlers benefit from recent tax reforms that have lowered rates significantly. The Natural State now has a simplified two-bracket progressive income tax with a top rate of just 3.9%—making it one of the more affordable states for freelancers and gig workers in the South.
How Side Hustle Taxes Work in Arkansas
Arkansas reformed its tax system with two simple brackets for 2025:
**Arkansas state tax rates (2025):** - 2.0% on income up to $4,500 - 3.9% on income over $4,500
**Key features:** - No local income taxes in Arkansas - Simplified from previous multi-bracket system - Rate reductions have been ongoing since 2022
For most side hustlers with meaningful income, you'll pay the 3.9% rate on the majority of your earnings.
What Arkansas Side Hustlers Owe
Let's say you're a single filer in Little Rock with a $48,000 W-2 job and $12,000 in side hustle income from selling crafts online, with $1,500 in business expenses.
**Your estimated taxes on the side hustle:** - Net self-employment income: $10,500 - Federal SE tax (15.3% of 92.35%): ~$1,485 - Federal income tax on side income: ~$2,310 (22% bracket) - Arkansas state tax (3.9%): ~$410 - **Total additional tax: ~$4,205**
Your effective tax rate on the side hustle is about 40%.
Arkansas Tax Deadlines 2025
Arkansas estimated tax deadlines: - **Q1**: April 15, 2025 - **Q2**: June 16, 2025 - **Q3**: September 15, 2025 - **Q4**: January 15, 2026
Use Arkansas Form AR1000ES for state estimated tax payments.
Common Deductions for Arkansas Freelancers
Arkansas deductions for side hustlers: - Arkansas uses federal adjusted gross income as the starting point - All Schedule C business expenses reduce your Arkansas taxable income - Home office expenses - Business mileage (67 cents/mile for 2025) - Equipment and supplies
Arkansas Side Hustle Tax FAQ
What is Arkansas's top tax rate?
Arkansas has a top income tax rate of 3.9% for 2025, applying to income over $4,500. The lower bracket is 2.0% on the first $4,500.
Does Arkansas have local income taxes?
No, Arkansas has no local or city income taxes. You only pay the state tax rate on your side hustle income.
Has Arkansas been cutting taxes?
Yes, Arkansas has significantly reduced its income tax rates in recent years. The top rate dropped from 5.9% in 2021 to 3.9% in 2025.
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