An act TO CREATE THE OVERTIME BUT NOT OVERTAXED ACT, the official text

Stricken language would be deleted from and underlined language would be added to present law.

1 State of Arkansas             A Bill
2 95th General Assembly

3 Regular Session, 2025                                       HOUSE BILL 1822

4

5 By: Representative Underwood

6

7

8                               For An Act To Be Entitled

9   AN ACT TO CREATE THE OVERTIME BUT NOT OVERTAXED ACT;

10  TO EXEMPT COMPENSATION FOR OVERTIME FROM THE INCOME

11  TAX; AND FOR OTHER PURPOSES.

12

13

14                              Subtitle

15                       THE OVERTIME BUT NOT OVERTAXED ACT.

16

17 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:

18

19  SECTION 1. DO NOT CODIFY. Title.

20  This act shall be known and may be cited as the "Overtime but not

21 Overtaxed Act".

22

23  SECTION 2. Arkansas Code Title 26, Chapter 51, Subchapter 3, is

24 amended to add an additional section to read as follows:

25  26-51-317. Overtime.

26  (a) As used in this section, "overtime" means time worked in a

27 workweek that:

28  (1) Exceeds forty (40) hours for the workweek; and

29  (2) Is required to be compensated under the Fair Labor Standards

30 Act of 1938, 29 U.S.C. � 201 et seq., as it existed on January 1, 2025.

31  (b) Compensation for overtime is exempt from the income tax levied

32 under this chapter.

33

34  SECTION 3. EFFECTIVE DATE. Section 1 of this act is effective for tax

35 years beginning on or after January 1, 2026.

36

    *JLL327*                                                  03/18/2025 9:14:44 AM JLL327