If you serve in the military or have served, Arkansas offers one of the clearest property tax breaks in the country for fully disabled veterans, along with income tax rules that protect military pay. Arkansas draws many military families after a PCS, which is short for Permanent Change of Station, the official military move from one duty station to another, with Little Rock Air Force Base in Jacksonville, Fort Smith and the former Fort Chaffee in the west, and the Pine Bluff Arsenal in the south. This guide explains the main rules in plain language and points you to the state's own sources. Tax law changes, so treat these figures as a starting point and confirm the current rules before you file.
How Arkansas Helps Disabled Veterans With Property Taxes
Arkansas gives a full property tax exemption to its most severely disabled veterans. The U.S. Department of Veterans Affairs, known as the VA, is the federal agency that rates service-connected disabilities, and the highest rating opens the door to this benefit.
Under Arkansas law, set in Arkansas Code 26-3-306, a veteran with a service-connected 100 percent total and permanent disability rating is exempt from paying all state property taxes on the homestead and personal property the veteran owns and lives in. The same exemption reaches a veteran who has been awarded special monthly compensation by the VA for the loss of, or loss of use of, one or more limbs, or for total blindness in one or both eyes. As the Arkansas Department of Finance and Administration's property tax relief page and county collectors describe, this is a true exemption, not a deduction, so a qualifying veteran's homestead is removed from the property tax rolls.
What the Exemption Covers and Excludes
The exemption applies to the homestead you occupy and to personal property you own. It does not cover rental property, and county offices note that special improvement taxes, city liens, sanitation fees, and similar charges are not part of the exemption. You must occupy the home to qualify. Because the exact reach can vary by county, confirm the details with your county collector.
Surviving Spouses and Dependent Children
The benefit can carry to a surviving spouse and to minor dependent children. The surviving spouse and minor dependent children of a veteran who died from a service-connected cause are also exempt from these property taxes, and the surviving spouse keeps the exemption as long as he or she remains unmarried. Confirm the conditions with your county collector and the Arkansas Department of Veterans Affairs.
How It Works With Your Local Tax Bill
Property tax in Arkansas is assessed and collected at the county level. You assess your property with the county assessor and pay through the county collector, and you claim the disabled veteran exemption by giving the county your VA documentation. The VA mails a Summary of Benefits letter each year, and counties such as Pulaski County, home to Little Rock and Little Rock Air Force Base, post the disabled veteran exemption process for residents to follow.
Veterans who do not qualify for the full exemption still benefit from a break every Arkansas homeowner receives. Under Amendment 79, the state gives a homestead property tax credit on your principal residence. The Department of Finance and Administration administers this relief, and the credit rises to up to $600 beginning with 2026 tax bills, up from $500. Amendment 79 also caps how fast the taxable value of a homestead can rise, at 5 percent per year, which steadies the bill over time. If you are weighing where to settle, our guide to the military bases in Arkansas can help you picture the local cost of owning a home.
Military Pay and Arkansas State Income Tax
Arkansas has a state income tax, but it shields military pay broadly. Military pay earned for service in an active or reserve component of the armed forces is exempt from Arkansas income tax. Military retirement pay is also exempt, a benefit Arkansas put in place in 2017. As the state's guide for military service members notes, service members may qualify for an exemption from state income tax on military pay and allowances, along with other breaks.
VA disability compensation is not part of federal income, so Arkansas does not tax it either. Between exempt active-duty pay, exempt retirement pay, and untaxed VA compensation, many military families owe little or no Arkansas income tax on their service income. Rates and rules can change, so confirm the current details with the Department of Finance and Administration before you file.
A Note for Military Spouses: MSRRA
If you are a military spouse, the Military Spouse Residency Relief Act, known as MSRRA, may matter to you. MSRRA is a federal law that lets a military spouse keep a home state for tax and voting purposes even after moving on military orders. You do not automatically become an Arkansas resident just because your service member got orders here.
Under the related federal rules, a service member, the spouse, or both may choose the service member's home state, the spouse's home state, or the service member's permanent duty station for residency. Because that choice affects both states' taxes, confirm yours before you file. For the property tax exemption in this guide, what usually matters most is that the qualifying veteran owns and lives in the home as the homestead.
