Arkansas Governor Sarah Huckabee Sanders has signed legislation revising the law on the apportionment of corporation income tax for multistate businesses. The legislation changes the method for sourcing receipts for services and intangibles from “cost of performance” to “market-based” sourcing. In addition, the legislation offers guidance for using an alternative apportionment method. The legislation also excludes the income of a nonresident corporation or partnership from income tax if the business has no physical presence in Arkansas and its Arkansas receipts for the preceding year were $250,000 or less. (L. 2025, S567 (Act 719, effective for tax years beginning on and after 01/01/2026.)
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