Code of Arkansas Rules Title 26 — Taxation

26 CAR § 130-143

Sales factor — Other than tangible personal property — Arkansas Code § 26-51-717

Official textcodeofarrules.arkansas.gov10 subsections

# (a)

Gross receipts from transactions other than sales of tangible personal property are attributed to Arkansas if the income-producing activity is performed:

# (1)

Entirely within Arkansas; or

# (2)

Both inside and outside of Arkansas, in which event the portion of income reportable to Arkansas shall be the percentage that is used in the formula for apportioning income to Arkansas during the year of the sale.

# (b)

The term "income-producing activity" applies to each separate item of income and means the transactions and activity directly engaged in by the taxpayer, or by anyone acting on the taxpayer's behalf, in the regular course of its trade or business for the ultimate purpose of obtaining gains or profit.

# (c)

Accordingly, income-producing activity includes, but is not limited to, the following:

# (1)

The rendering of personal services by employees or the utilization of tangible and intangible property by the taxpayer in performing a service;

# (2)

The sale, rental, leasing, licensing, or other use of real property;

# (3)

The rental, leasing, licensing, or other use of tangible personal property; or

# (4)

The sale, licensing, or other use of intangible personal property.

# (d)

The mere holding of intangible personal property is not, of itself, an income-producing activity.

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