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Job Creation Incentives

 

Incentive Tiers

Arkansas' job-creation incentives are based on payroll and use a tier system based on poverty rate, unemployment rate, per capita personal income and population growth to determine qualification criteria and benefits. Tiers are assigned annually based on current data.

View the 2023 Arkansas Incentives Tier Map

Advantage Arkansas (Income Tax Credit)

Advantage Arkansas offers a state income tax credit for job creation based on the payroll of new, full-time, permanent employees hired as a result of the project. The Tier Map linked above shows the job creation requirements and the benefits of the program.

In order to qualify for the Advantage Arkansas program (all tiers), the proposed average hourly wage of the new employees hired as a result of the project must be equal to or greater than $14.94. This minimum average hourly wage is applicable to those eligibility categories that do not require higher wage thresholds as determined by law. Please see the Eligibility section below for more details.

The Advantage Arkansas income tax credit is earned each tax year for a period of five years. The income tax credit cannot offset more than 50% of a business’ income tax liability in any one year and may be carried forward for nine years beyond the tax year in which the credit was first earned. The credit begins in the tax year in which the new employees are hired. Employees included in the new additional payroll under the project must be Arkansas taxpayers.

ArkPlus (Income Tax Credit)

ArkPlus is a state income tax credit program that provides tax credits of 10% of the total investment in a new location or expansion project. This incentive is offered at the discretion of the AEDC Executive Director.

ArkPlus requires both a minimum investment and a minimum payroll of new, full-time, permanent employees hired as a result of the project, depending on the tier in which the business locates. The business must reach the investment threshold for the tier in which it is located within four years from the date of the signing of the financial incentive agreement and the payroll threshold for the tier in which it is located within 24 months from the date of the signing of the financial incentive agreement.

The income tax credits may be used to offset 50% of the Arkansas income tax liability in the tax year the credit is earned. Any unused credits may be carried forward for nine years beyond the tax year in which the credit was first earned.

Create Rebate (Cash Rebate)

Create Rebate provides annual cash payments based on a company’s annual payroll for new, full-time, permanent employees. This incentive is offered at the discretion of the AEDC Executive Director.  

Create Rebate requires a minimum payroll of new, full-time, permanent employees hired as a result of the project, depending on the tier in which the business locates. The business must reach the payroll threshold for the tier in which it is located within 24 months from the date of the signing of the financial incentive agreement.

Create Rebate benefits are available after the business certifies to the Arkansas Department of Finance & Administration that it has fulfilled the terms of the financial incentive agreement and the reported payroll has been verified. The percentage of the benefit depends on the tier assignment of the county where the job creation occurs.

Infrastructure Grants (Governor's Quick Action Closing Fund, Community Development Block Grants)

AEDC has the ability to share the cost of project infrastructure needs by committing grants from state and federal infrastructure funds. These funds are offered at the discretion of the State.  The amount of assistance committed is dependent upon the strength of the company, of jobs, average wage, project investment and costs associated with facility/site improvements.

Eligibility

  • Manufacturers in NAICS codes 31-33
  • Businesses primarily engaged in the design and development of software, digital content production and preservation, computer processing, data preparation services or information retrieval services. Eligible computer-related businesses must derive at least 51% of their revenue from out-of-state sales and pay an average in excess of 125% of the lesser of the state or county average hourly wage to employees whose payroll is subject to incentive benefits.
  • Businesses primarily engaged in film and digital product productions and post-productions that derive at least 51% of their revenue from out-of-state sales and pay an average in excess of 125% of the lesser of the state or county average hourly wage to employees whose payroll is subject to incentive benefits.
  • Distribution centers that derive 75% of their sales revenue from out-of-state customers
    Intermodal facilities with more than one mode of interconnected movement of freight, commerce, or passengers.
    Office sector businesses that support primary business needs and that are non-retail businesses deriving at least 75% of their sales revenue from out-of-state.
  • National or regional corporate headquarters as classified in the NAICS code 551114
  • Businesses primarily engaged in research and development in the physical, engineering, and life sciences as classified in the NAICS codes  541713, 541714, 541715. 
  • Scientific and technical services businesses that derive at least 51% of their revenue from out-of-state sales and pay an average in excess of 150% of the lesser of the state or county average hourly wage to employees whose payroll is subject to incentive benefits.
  • Businesses primarily engaged in support activities for air transportation, NAICS Code 488190, that derive at least 75% of their revenue from out-of-state sales.
  • Businesses primarily engaged in support activities for rail transportation, NAICS Code 488210, that derive at least 75% of their revenue from out-of-state sales.