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 adds a new provision to the Income Tax Act of 1929 that excludes these employer contributions from an employee's gross income. Additionally, the bill allows employers to deduct their contributions to these healthcare programs when calculating their net income for tax purposes.

The new legal language includes the addition of a subdivision to Arkansas Code 26-51-404(b) that defines employer contributions to healthcare sharing ministries and medical cost-sharing programs as excluded from gross income. Furthermore, a new section, 26-51-462, is introduced to allow deductions for these contributions. The provisions of this act will take effect for tax years beginning on or after January 1, 2026.

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