Gambling winnings tax in Arkansas

Arkansas allows gambling losses only as an itemized deduction on the state return, whether or not you itemize federally. Take its standard deduction and it taxes your gross winnings. Whether only 90 percent of your losses count from 2026 is not settled.

Checked against Arkansas’s own sources on 2026-09-25.

In short

If a win puts your net taxable income above $94,700, each extra dollar up to $97,600 is taxed at about 13.7 percent, because Arkansas takes back the benefit of its lower bands there.
If your income is modest, itemizing only to deduct gambling losses can leave you worse off than no deduction, because you lose the lower Low Income Tax Table.9
You can deduct Mississippi gambling taxes you paid. This matters if you play in Tunica.6
If you are married and file separately, your gambling loss deduction is split by your shares of income, even if only one of you had the losses.6

How Arkansas treats gambling losses

5, 6

Arkansas does not tie the deduction to your federal itemizing choice. You can itemize on the Arkansas return even if you take the federal standard deduction, but the losses count only if you do, in place of Arkansas's standard deduction.

The two examples below are the same numbers the calculator uses, worked at Arkansas rates.

Two examples, worked at 2026 Arkansas rates

A single filer with $60,000 of other income who takes the standard deduction on everything except gambling losses.

A losing year

You win $50,000 and lose $52,000, so you finish down $2,000.

Federal: $3,596
Arkansas: $210
Total: $3,806

You finished the year down and still owe tax.

Federally you itemize, so your losses offset your winnings, but the 2026 rule caps that deduction at 90 percent and leaves $3,200 taxable. Arkansas lets you deduct gambling losses as an itemized deduction on the state return, whether or not you itemize federally. Your Arkansas income, after the larger of the standard deduction and your itemized deductions, goes from $57,530 without the win to $63,200 with it. The extra $5,670 is taxed at 3.7 percent, which comes to $210.

A winning year

You win $50,000 and lose $10,000, so you finish up $40,000.

Federal: $10,350
Arkansas: $1,896
Total: $12,246

Federally you take the $16,100 standard deduction, which is worth more than itemizing, so your gambling losses do not reduce your federal tax at all. Arkansas lets you deduct gambling losses as an itemized deduction on the state return, whether or not you itemize federally. Your Arkansas income, after the larger of the standard deduction and your itemized deductions, goes from $57,530 without the win to $101,000 with it. The extra $43,470 is taxed at 3.7 percent, plus $287 the state adds on top, which comes to $1,896.

Arkansas income tax rates, 2026

2, 3, 4, 8

Taxable income	Rate
$0 to $5,599	0 percent
$5,599 to $11,199	2 percent
$11,199 to $15,999	3 percent
$15,999 to $26,399	3.4 percent
$26,399 and above	3.7 percent

The calculator also applies what this table leaves out: an add-back that takes back the lower bands at higher incomes and a personal tax credit off the tax, which does not change with income.

Withholding on winnings

Arkansas sets a withholding rate of 3.9 percent for gambling winnings. The payout at which withholding starts could not be confirmed from a primary source, so do not assume anything was withheld on your win.

Withholding is a credit against the bill, not the bill itself. It does not settle what you owe.

The federal 90 percent loss limit in Arkansas

From tax year 2026 the federal deduction for gambling losses is cut to 90 percent of what you lost, and never more than what you won. Public Law 119-21 did it, at section 70114(a), by rewriting 26 U.S.C. 165(d).

No Arkansas statute or guidance addresses the federal 90 percent limit for tax year 2026.

We could not confirm from a primary source how Arkansas tracks the federal code. The paragraph above says what this means for the federal 90 percent limit.

Our estimate assumes the limit applies, which gives the higher tax. The calculator also shows the tax if the limit does not apply. We would rather tell you the number could be lower than let you plan around one that turns out to be too low.

If you do not live in Arkansas

A nonresident with any Arkansas source gross income must file Form AR1000NR, with no dollar floor. Arkansas casino winnings are Arkansas source.

The calculator works the bill for somebody who lives in Arkansas. It does not apportion income between states, so a nonresident return is not what the figure above describes.

More about Arkansas

Deducting gambling losses

The 2 percent floor that applies to other miscellaneous deductions does not apply to your gambling losses. There is no dollar cap and no overall phase-out.5, 6

Arkansas lets you deduct Mississippi gambling taxes you paid. This matters if you play in Tunica.6

The Arkansas standard deduction is $2,470, or $4,940 joint. The 2026 estimated tax worksheet gives $2,470 per taxpayer for 2026, and the 2026 withholding formula also uses $2,470. It was the same for 2025.3, 6, 4

Withholding

The 3.9 percent casino withholding rate comes from department withholding instructions effective 01/01/2024 and updated 07/01/2024. Those came before Act 2 cut the 2026 top rate to 3.7 percent.7, 8

The regular and low income tables

Arkansas has two tax tables. The Low Income Tax Table gives a lower tax, but you cannot use it if you itemize. If your income is modest and you itemize only to deduct gambling losses, you must use the Regular Table and can end up worse off than with no deduction.9

The regular Arkansas rate table is the same for every filing status, so a married couple gets no wider bands. Only the Low Income Tax Tables change with filing status. There are separate tables for single, for head of household or surviving spouse, and for married filing jointly, split again by number of dependents.9, 3

The band that takes back lower rates

Above $94,700 of net taxable income, Arkansas takes back the benefit of its lower bands in $100 steps up to $97,600. Inside that band, each extra dollar is taxed at about 13.7 percent. From $97,601 the tax is 3.7 percent less a flat $79.90.

If you are married filing separately

If you are married and file separately, you and your spouse split your total itemized deductions by your share of income. So the gambling loss deduction is split even if only one of you had the losses. If one of you itemizes, both of you must.6

If the 2026 tax table changes

The law still says Arkansas adjusts its tax table each year, and no adjusted 2026 table is published. If the department adjusts the 2026 table, the bands rise. That lowers the tax on each return, but the cost of a win can go up or down. For example, if your income is just above $97,600 without the win, bands 2 percent higher would make a $10,000 win cost about $190 more.

About this estimate

The calculator takes Arkansas’ personal tax credit of $29, or $58 joint or head of household, off the tax. If you are 65 or older it takes $58 more a person, for the Over 65 and 65 Special credits. The 65 Special credit is only for filers who claim no retirement income exemption. It leaves out $29 for each dependent.

The calculator uses $2,470 a taxpayer, the figure on the 2026 Form AR1000ES. The 2026 return instructions are not published yet.

The calculator does not include the Low Income Tax Tables, so it does not show the case where itemizing leaves you worse off.

The calculator does not apply the rule that both spouses must itemize. If you file separately, it lets you choose alone.

Sources

Every figure above traces to a primary source: a statute, an administrative code, a state agency page, or official form instructions.

1. 2026 Form AR1000ES (R 5/6/2026), tax credits: $29 single or separate, $58 joint or head of household, $29 each dependent, and $29 each for blind, deaf, Over 65 and 65 Special (checked 2026-10-12)
2. Arkansas 2025 indexed tax brackets, the thresholds Act 2 carries into 2026 (checked 2026-09-15)
3. 2026 Form AR1000ES instructions (R 5/6/2026), tax rate schedule: 0 percent below $5,599, then 2, 3, 3.4 and 3.7 percent, a single schedule with no split by filing status, and a standard deduction of $2,470 per taxpayer (checked 2026-10-11)
4. DFA withholding tax formula, tax year 2026: the Act 2 table, the bracket adjustment to $97,600 and a $2,470 standard deduction (checked 2026-09-25)
5. DFA publication 208, gambling income and expenses (checked 2026-09-11)
6. Form AR1000F and AR1000NR instructions (2025), including the standard deduction by filing status (checked 2026-09-25)
7. DFA withholding instructions, 3.9 percent on casino gambling (checked 2026-09-11)
8. Act 2 of the 2026 First Extraordinary Session (SB1), approved 5/6/26, 2026 individual income tax table at 3.7 percent (checked 2026-09-25)
9. 2025 AR1000F and AR1000NR instructions, Low Income Tax Tables and the Additional Tax Credit for Qualified Individuals (checked 2026-09-24)

The federal rule, for the parts of this page that rest on it

10. Public Law 119-21 section 70114(a), which rewrote 26 U.S.C. 165(d) on wagering losses from tax year 2026 and sets out its text (checked 2026-10-18)

We could not confirm these from an official source: how the state follows the federal tax code; the date the state follows the federal code to; whether any city or county tax applies; the payout at which withholding starts.