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franchise tax

A franchise tax is a state tax on businesses and other entities (corporations, limited liability companies, trusts, etc.) that are formed in or doing business in a state.

A franchise tax is said to be a tax on the privilege of doing business in a state and is sometimes referred to as a privilege tax. The amount of tax due is often calculated as a percentage of a business’s income, for example.

In Arkansas, the franchise tax is a tax levied on corporations, LLCs, banks, and insurance companies for the privilege of doing business in the state. The tax is administered by the Arkansas Secretary of State. The amount of the franchise tax can be based on the corporation's authorized shares of stock and par value, but for LLCs, it is typically a flat fee. The tax is due annually by May 1st, and failure to pay the franchise tax can result in penalties and interest, as well as the potential for the business to be barred from doing business in Arkansas. It's important for businesses operating in Arkansas to understand their obligations under the state's franchise tax laws to remain in good standing.

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Taxes

franchise tax

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Arkansas State Code

Arkansas State Code

Taxes

franchise tax

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