Capital Gains Tax Reduction

The Capital Gains Tax Reduction afforded in the 1999 legislative session allows for an exemption of 30% of capital gains after January 1, 1999, if the taxpayer has a capital gains tax liability. For taxpayers other than corporations, gross income shall not include 50% of any gain from the sale or exchange of qualified small business stock held for more than five years.

Profits from Arkansas venture capital investments are also exempt from the capital gains tax, provided that the investment was made in a business in Arkansas that is a qualified technology-based or biotechnology enterprise or a client of the Genesis Technology Incubator. Investments in companies registered on a National Securities Exchange are not eligible.