This bill amends the Arkansas income tax law to provide favorable tax treatment for employer contributions to healthcare sharing ministries and other medical cost-sharing programs. Specifically, it introduces a new provision that excludes these employer contributions from being considered as part of an employee's gross income, thereby exempting them from income tax. Additionally, the bill allows employers to deduct their contributions to these programs when calculating their net income for tax purposes.

The new legal language added to the Arkansas Code includes a specific definition of healthcare sharing ministries and outlines the conditions under which employer contributions can be deducted. The effective date for these changes is set for tax years beginning on or after January 1, 2026. This legislation aims to encourage the use of alternative healthcare financing options by providing tax incentives for employers who contribute to their employees' healthcare sharing ministries or medical cost-sharing programs.

Statutes affected:
Old version HB1698 V2 - 3-17-2025 11:49 AM: 26-51-404(b)
Old version HB1698 V3 - 3-31-2025 11:24 AM: 26-51-404(b)
Old version HB1698 Original - 3-6-2025 10:51 AM: 26-51-404(b)
HB 1698: 26-51-404(b)