Shown verbatim: the complete text as captured from the official PDF posted by the Arkansas General Assembly, fetched 2026-07-23. Page and line markers are part of the official record; nothing is edited or removed. The official bill page.
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 SENATE BILL 233
4
5 By: Senator C. Penzo
6 By: Representatives Lundstrum, Maddox
7
8 For An Act To Be Entitled
9 AN ACT TO AMEND THE INCOME TAX LAWS RELATING TO
10 CERTAIN TRUSTS; TO PRESERVE CERTAIN TRUST ASSETS; TO
11 EXEMPT CERTAIN TRUSTS FROM INCOME TAX; AND FOR OTHER
12 PURPOSES.
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15 Subtitle
16 TO AMEND THE INCOME TAX LAWS RELATING TO
17 CERTAIN TRUSTS; TO PRESERVE CERTAIN
18 TRUST ASSETS; AND TO EXEMPT CERTAIN
19 TRUSTS FROM INCOME TAX.
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21 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:
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23 SECTION 1. DO NOT CODIFY. Legislative intent.
24 It is the intent of the General Assembly to:
25 (1) Reform Arkansas trust tax law to increase the state's
26 competitiveness in the financial services sector by attracting out-of-state
27 trust assets for administration by Arkansas trustees;
28 (2) Recognize that Arkansas citizens currently establish trusts
29 in foreign states to avoid trust-level taxation;
30 (3) Recognize that foreign states are reaping the benefit that
31 comes with the management and administration of trust assets in those states;
32 and
33 (4) Amend the law to remove the incentive for Arkansas residents
34 to set up nongrantor trusts in foreign states that will encourage Arkansans
35 to keep trust assets in state where Arkansas trustees will manage and
36 administer the trust assets.
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SB233
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2 SECTION 2. Arkansas Code Title 26, Chapter 51, Subchapter 3, is amended
3 to add an additional section to read as follows:
4 26-51-317. Nongrantor trusts.
5 There is allowed an exemption from the income tax imposed under this
6 chapter for a trust that is administered by a trustee who is a resident of
7 this state if the trust is not considered a grantor trust under 26 U.S.C. �
8 671 et seq., as it existed on January 1, 2025, and any related regulations,
9 as they existed on January 1, 2025.
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11 SECTION 3. EFFECTIVE DATE. This act is effective for tax years
12 beginning on or after January 1, 2025.
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2 02/13/2025 3:36:48 PM JLL182Every fact on this page links to its source, starting with the official bill record.