Taxes in Texarkana
Texarkana's tax picture is genuinely unusual: a real, rare border-city income-tax exemption for bona fide city residents, offset by a genuinely elevated combined sales tax.
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Learn moreA real, rare income-tax exemption
Bona fide residents within actual Texarkana, AR city limits are exempt from Arkansas state income tax under 1.26 Ark. Code R. Sec. 51-403(b)(13), a real statute dating back roughly four decades, tied to Texas's own lack of a state income tax across the state line. A resident must still file an Arkansas return and verify bona fide city residency; the exemption does not extend to surrounding rural Miller County.
A genuinely higher combined sales tax
Texarkana, AR's combined sales tax ran approximately 10.25% (6.5% state + 1.25% Miller County + 2.5% city) -- meaningfully higher than Texarkana, Texas's own ~8.25% combined rate just across State Line Avenue.
Low property taxes
This record's own Ownwell-cited effective property tax rate ran approximately 0.88%, and Arkansas's real, current Amendment 79 homestead credit ($600 for 2026) applies to qualifying owner-occupied homes.
Key takeaways
- Bona fide Texarkana, AR city-limit residents are genuinely exempt from Arkansas state income tax.
- Combined sales tax runs approximately 10.25% -- higher than the Texas side's ~8.25%.
- Effective property tax rate (~0.88%) runs low by national standards; Amendment 79's $600 homestead credit applies.
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