Payroll Arkansas Unique Aspects of Arkansas Payroll Law and Practice
Below is a MRR and PLR article in category Business -> subcategory Other.
Payroll in Arkansas: Navigating State Payroll Laws and Practices
Overview
Managing payroll in Arkansas involves understanding specific state laws and practices. This guide covers key areas such as tax withholding, unemployment insurance, wage and hour regulations, and child support withholding.
Key Topics
- Tax Withholding and Reporting- Unemployment Insurance
- Wage and Hour Laws
- Child Support Withholding
Tax Withholding in Arkansas
The Arkansas Department of Finance and Administration oversees state income tax collection and reporting. Employers must use the Arkansas AR4EC form for state income tax withholding instead of the federal W-4.
- Section 125 Plans and 401(k)s: In Arkansas, contributions to both cafeteria plans and 401(k) plans are not taxable for state income or unemployment insurance purposes.
- Supplemental Wages: These are taxed at a flat rate of 7%.
- W-2 Filing: Employers can file state W-2s electronically if desired.
Unemployment Insurance Tax
The Employment Security Department manages unemployment insurance in Arkansas.
- Taxable Wage Base: Wages up to $10,000 are taxable.
- Reporting: Employers with 250+ employees must report via magnetic media.
- Record Retention: Unemployment records must be kept for at least five years.
Wage and Hour Laws
The Arkansas Department of Labor oversees wage and hour regulations.
- Minimum Wage: Non-FLSA employers must pay at least $5.15 per hour.
- Overtime: Overtime is paid at 1.5 times the regular rate after a 40-hour work week.
- Payment Frequency: Employees must be paid semi-monthly, or monthly for certain exempt employees earning $25,000 or more annually.
- Final Pay: Involuntarily terminated employees should receive their final check within seven working days. There is no requirement for employees who leave voluntarily.
New Hire Reporting
Employers must report new hires and rehires within 20 days, including:
- Employee's name, address, and SSN
- Employer’s name, address, and EIN
Reports can be submitted by mail, fax, or electronically. There’s no penalty for late submission in Arkansas.
Child Support Withholding
The Office of Child Support Enforcement handles child support orders.
- Withholding Timeline: Begin withholding 14 days after receiving the order.
- Payment Timing: Payments are due on payday.
- Administrative Fee: Maximum of $2.50 per pay period.
- Withholding Limits: Follow federal guidelines under the CCPA.
Additional Considerations
- Direct Deposit: Employees have the right to opt-out in writing.
- Pay Stubs: Arkansas law doesn’t specify pay stub requirements.
- Unclaimed Wages: Must be reported to the state after one year, with records kept for five years.
- Tip Credits: No state provision for tip credits towards minimum wage.
- Breaks and Meals: No state-mandated rest or meal breaks.
- Record Retention: Wage and hour records must be retained for at least three years.
Note
This summary is subject to change as regulations are updated. Always verify current laws for the latest requirements.
You can find the original non-AI version of this article here: Payroll Arkansas Unique Aspects of Arkansas Payroll Law and Practice.
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