Arkansas Code of 1987 (2024)
Title 26 - TAXATION (§§ 26-1-101 — 26-82-119)
Subtitle 5 - STATE TAXES (§§ 26-50-101 — 26-65-108)
Chapter 54 - CORPORATE FRANCHISE TAXES (§§ 26-54-101 — 26-54-116)
Section 26-54-107 - Computation of tax - Penalty - Relief

• (a) Using the information reported on the franchise tax report under § 26-54-105 and any other information received by him or her bearing upon the subject, the Secretary of State shall compute the amount of tax of each corporation at the rate or rates provided by this chapter.

• (b)
  • (1)
    • (A) If the taxpayer fails to comply with the filing and remittance requirements under § 26-54-105(c), the Secretary of State shall assess the corporation a penalty of twenty-five dollars ($25.00) plus interest on the tax and penalty from the date due until paid at the rate of ten percent (10%) per year.
    • (B) However, the franchise tax, penalty, and interest for any tax year shall not exceed two (2) times the corporation's tax owed.
  • (2) On or before November 1 of each year, the Secretary of State shall mail notice to the corporation at its last known address stating that the corporation is subject to revocation of its corporate charter under § 26-54-111 for the failure to pay corporate franchise tax.

• (c) The Secretary of State or his or her designee may agree to settle or compromise a dispute concerning interest or penalties associated with corporate franchise taxes if the taxpayer:
  • (1) Disputes the proposed amount; or
  • (2) Is insolvent or bankrupt.

• (d)
  • (1) The Secretary of State may waive any accrued interest or assessed penalties imposed on a taxpayer due to a failure to remit corporate franchise taxes under § 26-54-105(c), if:
    • (A) The taxpayer is reasonably mistaken about the application of this chapter or the computation of the franchise tax to the corporation; or
    • (B) A taxpayer cannot pay the accrued interest or assessed penalties because of the taxpayer's insolvency or bankruptcy.
  • (2) The Secretary of State may waive any fees that a taxpayer owes if the taxpayer desires to dissolve the corporation.
  • (3) If a taxpayer demonstrates that a corporation was not doing business in the state for the period for which penalties and interest are owed under this section, the Secretary of State shall waive the amount due under this section if the taxpayer demonstrates that the taxpayer intends to dissolve the corporation.

• (e) If the parties cannot resolve the dispute, the parties may pursue any other remedy available to them, including without limitation remedies available under the Arkansas Administrative Procedure Act, § 25-15-201 et seq.

• (f) The Secretary of State shall develop guidelines to assist a taxpayer in resolving a corporate franchise tax dispute.

Amended by Act 2023, No. 459,§ 8, eff. 8/1/2023.

Amended by Act 2021, No. 523,§ 16, eff. 4/1/2021.

Amended by Act 2019, No. 819,§ 21, eff. 5/1/2021.

Amended by Act 2015, No. 834,§ 2, eff. 7/22/2015.

Amended by Act 2015, No. 834,§ 1, eff. 7/22/2015.

Amended by Act 2013, No. 1093,§ 1, eff. 4/11/2013.

Acts 1979, No. 889, § 6; A.S.A. 1947, § 84-1838; Acts 1987, No. 19, § 3; 1991, No. 1046, § 3; 1991, No. 1140, § 3; 1999, No. 1037, § 1.