How to File an LLC Annual Report in Arkansas? (Full Guide)

Published by Atty. Danya Shakfeh | Author

Last updated: November 19, 2024

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Filing an annual franchise tax report in Arkansas is a state requirement to keep your entity in the right standing with the Secretary of State.

To help you take the right steps, we teamed up with licensed business experts who've been in the LLC sector for more than a decade.

We spent the past four weeks poring over the Arkansas Secretary of State's website for the correct annual tax report filing information.

Here's a summary of everything you need to know about filing annual franchise tax reports in Arkansas.

Quick Summary

What Is an Arkansas LLC Annual Franchise Tax Report?

An Arkansas LLC annual franchise tax report is a privilege tax report that companies file to transact business in this state [1].

Many states refer to this document as the annual report, but it's called an annual franchise tax report in Arkansas.

A corporation receives personal liability protection for its owners as a registered business entity, as well as possible tax breaks, business brand protection, and other advantages.

In return, the state requires annual franchise tax filings as per the Arkansas Corporate Franchise Tax Act to maintain these advantages and compliance.

"An Arkansas franchise tax is a charge that businesses must pay to the state in exchange for the right to be incorporated or registered there."

- Jon Morgan, CEO, Co-Founder & Editor-in-Chief of Venture Smarter

Significantly, this underscores the vital role of small businesses, which in 2019 accounted for 47.2 percent of Arkansas's employment, surpassing the national average, according to the Small Business Administration.

This highlights the importance of adhering to state mandates to preserve the benefits crucial for business success and contribution to the state’s employment [2].

Free Download Arkansas LLC Annual Report

How to File an Arkansas Annual Report?

To file an Arkansas annual report, you must visit the Secretary of State's official website for the correct documents and file them online or by mail.

1. Online Filings

Follow these easy steps to file an annual report online:

• Visit the business entity search website.
• Enter your LLC or corporation name, fictitious name, registered agent name, state, and filing type, and click "search."
• Once the search is complete, your LLC name will pop up; click on it.
• On the next page, scroll down to select the "Pay Franchise Tax for this Corporation" option. Click on it.
• Proceed to fill out the details, including your entity number and federal ID.
• Complete the process by sharing your billing information and paying the required filing fee. (There's a $ 3$ convenience charge for ACH and $5 for online credit card payments).

During our first filing, once we submitted the annual franchise tax report, we received a payment receipt in our email, and the state examined your report and approved if everything was correct within 24 hours.

We found the online Arkansas annual report service an effective way to submit our filing because we were able to set calendar reminders so we didn't miss future deadlines.

2. Mail Filings

To file an annual report/franchise tax report by mail, you must:

• Visit the Arkansas Secretary of State's website to view annual reports and franchise taxes.
• Scroll the page to access the table at the bottom.
• Find "Limited Liability Company" and choose "PDF" next to the relevant year.
• Fill out the PDF form.
• Print out the form.
• Pay the filing fees with a money order or check.

Note that you should write the "Arkansas Secretary of State" on all the checks before mailing them.

Once you verify the details, complete the filing process and send the application and filing fees to the following:

Business & Commercial Services Division of the Arkansas Secretary of State
PO Box 8014
Little Rock, AR 72203-8014

During our second report filing, we submitted the form by mail and the Arkansas Secretary of State took 2-3 weeks to approve the LLC annual report.

What to Include in the Annual Report?

In Arkansas, the information included in the annual franchise tax report varies slightly depending on the type of business structure.

For our LLC, here's the information we provided:

• Address and name of the company
• Name, address, phone number, and email of tax contact
• The location of the main office in Arkansas
• The federal tax ID number
• Name and location of the Arkansas registered agent service
• Management structure (whether the LLC is run by members or managers)
• Members' and managers' names
• The tax preparer's name
• Signatures of the responsible party

Here's what corporations include in their report:

• Address and name of the corporation
• Name, address, phone number, and email of tax contact
• The type of business
• The federal tax ID number
• The location of the main office in Arkansas
• When and where the company first obtained a license
• Legal name and business location of the corporation registered agent
• The titles and current names of corporate governors
• Official signature of the authorized person

Here's what corporations with stocks include in their franchise tax report:

• Address and name of the corporation
• Name, address, phone number, and email of tax contact
• The ID number for federal taxes
• The type of business
• The Arkansas principal address
• Registered agent information (including their business name and address)
• The titles and current names of corporate directors/governors
• When and when the company first obtained a license
• Total permitted capital stock number and value
• Amount of issued and outstanding capital stock
• Tax due calculation
• Signature of the corporate officer

How early can I file my Annual Report?

LLCs and corporations can file an annual franchise tax report in Arkansas as early as January 1.

Also, all banks and insurance companies registered at the Arkansas Taxpayer Access Point can pay the yearly franchise tax to the Department of Finance and Administration (DFA) as early as January 1.

Related articles:

• How Much Does an LLC Cost in Arkansas
• How to Create an LLC in Arkansas
• Top LLC Formation Services in Arkansas

What is the filing fee for the report?

The annual report filing fee for LLCs in Arkansas is $150, and corporations without stocks pay $300 to file the Arkansas franchise tax report.

For Arkansas corporations with stocks, their annual franchise tax filing fees are calculated differently based on their assets and stocks.

To calculate your filing fee as a business owner:

• Start by dividing the total company's assets in Arkansas by the total company's assets in the United States.
• Multiply the outcome by the total value of stocks issued and outstanding capital.
• Multiply the result by 0.3%.

If the total amount you get is less than $150, you must pay a filing fee of $150. But if you get a total amount of more than $150, you must pay the full amount you get from the calculations.

What is the due date for submitting the report?

In Arkansas, the due date for the annual franchise tax report is May 1st each year.

For example, our company began operating on February 12th, 2021, so our first annual franchise tax was on May 1st, 2022.

What are the penalties for not filling out the LLC Annual Report?

If you fail to meet the Arkansas annual report deadline, your LLC or corporation will incur late fees of $25 (this amount must not exceed twice the original tax owed), plus a 10% interest every year the payment is past due.

Considering that 50% of small businesses fail within their first year according to Oberlo, it's crucial for Arkansas LLCs to avoid additional risks like administrative dissolution.

Failing to file the Arkansas franchise tax within 60 days can lead to the loss of your business's legal existence and protections, further endangering its survival and operations.

FAQs

References:

1. https://www.sos.arkansas.gov/uploads/bcs/LLC2_FT_2023.pdf
2. https://law.justia.com/codes/arkansas/2015/title-26/subtitle-5/chapter-54/section-26-54-104/