Good morning!  I am sharing the email our Dir of Finance and I drafted to explain the tax credit to employees:

Good afternoon, All.

Last month the Arkansas General Assembly approved the Inflationary Relief Income Tax Credit for 2022. You can claim this credit on your 2022 Arkansas State Income Tax return for a maximum of $150.00, provided you meet all the following criteria:

1. You are a Full year Arkansas resident; and,

2. You have been employed with the City since January 1, 2022; and,

3. You earn less than $87,000 annually (scaled credit for those who make more than $87,000).

As a result of this credit, the Department of Finance & Administration is adjusting the Employer’s Income Tax Withholding Tax Tables.

This change in the tax table will reduce the amount of State Tax Withholding from your paycheck beginning October 1, 2022, and ending December 31, 2022.

If you wish to remain at your current level of withholding, a new Withholding Exemption Certificate (form AR-4EC) should be completed and submitted to HR before OCTOBER 7, 2022.

To adjust your withholding, complete Line #4 on the AR-4EC by entering the dollar amount you want withheld in addition to the new tax withholding.

The tax tables will revert to the previous tables on December 31, 2022. Plan to amend your AR-4EC effective 1/1/23 if you do not wish to continue withholding the additional amount from Line #4 in 2023.

Download the AR-4EC here:

https://www.dfa.arkansas.gov/images/uploads/incomeTaxOffice/AR4EC2021_FI.pdf

Please complete the AR-4EC electronically (with signature) or by hand.

Email electronic copies (with signature) to HR@Maumelle.org

Deliver hard copies to HR in person.

SUPERVISORS – if your employees do not have a City email address, please provide them with a copy of this email and the AR-4EC.

Please consult your tax professional if you need additional information about this tax credit or to confirm if you are eligible.

If you have questions regarding your current withholding, please feel free to email or call: