How to Do Payroll in Arkansas

Last reviewed: July 2026

Payroll in Arkansas involves two layers: federal rules that apply everywhere, and state rules layered on top by the Arkansas Department of Finance and Administration and the Arkansas Division of Workforce Services. None of it is complicated once you know the order to do things in. Here is the full sequence, from your first hire through your first year-end filing.

Step 1: Get a Federal EIN

Before anything else, apply for an Employer Identification Number at IRS.gov/EIN. The application is free, takes a few minutes, and issues your EIN immediately online. You'll need this number for every state registration that follows, so get it first.

Step 2: Register with Arkansas Agencies

With your EIN in hand, register with two state agencies before you pay your first employee:

• The Arkansas Department of Finance and Administration for a state withholding tax account.
• The Arkansas Division of Workforce Services for a State Unemployment Insurance (SUI) account.

Both registrations are handled online and typically issue an account number within a few business days. If your business also carries workers' compensation exposure, most Arkansas employers need that coverage in place too, so line it up during this same window rather than after you've already run payroll.

From the Payroll Desk

Register before your first payday, not after. A late registration can leave you filing amended returns for a quarter you already paid wages in, which is more work than the registration itself.

Step 3: Set Up State Withholding

Every new employee fills out two forms before their first paycheck: the federal Form W-4 and Arkansas Form AR4EC, the state's Employee's Withholding Exemption Certificate. AR4EC tells you the employee's filing status and exemptions so you can withhold the correct amount of Arkansas income tax. If an employee never turns one in, the default rule is to withhold as if they are single with zero exemptions, which usually over-withholds, so it pays to collect the form up front.

Once you know how much to withhold, deposit it and file returns with the Department of Finance and Administration on the schedule assigned to your account. Our Form 941 guide covers the matching federal side of withholding deposits and quarterly returns.

Step 4: Register for SUI

SUI is an employer-paid tax, not a withholding from the employee's check. New Arkansas employers are assigned a standard new-employer rate that applies for roughly the first three years, after which the state calculates an experience rate from your claims history. The tax applies only to the first $7,000 of each employee's wages in a calendar year; once an employee crosses that threshold, no more SUI is owed for them that year.

Quarterly wage reports and SUI payments are due to the Arkansas Division of Workforce Services by the last day of the month following each quarter's end: April 30, July 31, October 31, and January 31.

Step 5: Pick a Pay Schedule

Arkansas requires most non-exempt employees to be paid at least semimonthly. Weekly and biweekly schedules both satisfy that floor since they pay more often, not less. Pick whichever cadence fits your cash flow and bookkeeping rhythm, then stick with it. Changing pay frequency mid-year creates confusion for employees and extra reconciliation work for you, so choose carefully at the start.

Use our paycheck calculator to check gross-to-net numbers before your first run, especially if you're estimating what a new hire's take-home pay will look like under Arkansas withholding.

Final Paycheck Rules

When an employee leaves, Arkansas requires the final paycheck within a set window tied to the regular pay schedule rather than an immediate same-day payout. Don't hold a final check hostage over unreturned equipment or unresolved disputes; that habit tends to invite a wage complaint. Pay what's owed on time and settle the equipment separately.

Deposit and Filing Calendar

A typical Arkansas employer juggles four recurring obligations:

Missing any one of these dates triggers penalties and interest, so it's worth setting calendar reminders the moment your accounts are open. Most payroll software handles the deposit timing automatically once it knows your assigned frequencies.

Year-End W-2 Filing

By January 31 each year, give every employee a Form W-2 covering the prior calendar year and file copies with the Social Security Administration. Arkansas also expects a copy or equivalent reconciliation filed with the Department of Finance and Administration; check your account's specific requirement when you register, since it can vary by filing volume. Keep payroll records, including AR4EC forms and wage reports, for at least four years in case of an audit.

Frequently Asked Questions

How do I do payroll for the first time in Arkansas?

Get a federal EIN from the IRS, register with the Arkansas Department of Finance and Administration for withholding, register with the Arkansas Division of Workforce Services for SUI, then set a pay schedule and choose a payroll system before you pay anyone.

What forms do I need to run payroll in Arkansas?

Every employee completes a federal Form W-4 and an Arkansas Form AR4EC. Employers file federal Form 941 quarterly, an Arkansas withholding return, an Arkansas quarterly wage report for SUI, and Form W-2 at year-end.

How often do I have to pay employees in Arkansas?

Arkansas law requires most non-exempt employees to be paid at least semimonthly. Weekly or biweekly schedules are also allowed as long as semimonthly is the floor.

How soon do I have to report a new hire in Arkansas?

Arkansas employers must report new and rehired employees to the Arkansas New Hire Reporting Center within 20 days of the hire date.