HB1026
To Create The Arkansas Promise Act; And To Create An Income Tax Credit For Tuition Paid For An Eligible Student At A Public Institution Of Higher Education.
Last Action (May 5, 2025): Died in House Committee at Sine Die adjournment.
Sponsors
AI-Generated Summary
House Bill 1026, known as the 'Arkansas Promise Act,' establishes a refundable state income tax credit for tuition paid by taxpayers for themselves or their dependents at public two-year or four-year higher education institutions in Arkansas. To qualify, students must be in-state residents with an adjusted gross income of $90,000 or less, be degree- or credential-seeking, and have enrolled within two years of high school graduation or equivalent. Additionally, students must have fewer than 65 accumulated credit hours, maintain at least a 2.5 GPA, and complete at least six credit hours per semester. The credit can be claimed for a maximum of four consecutive academic semesters and applies to tuition costs not covered by other scholarships or grants. The act is effective for tax years beginning on or after January 1, 2025.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries are middle- and lower-income Arkansas residents who pay for their own or their dependents' tuition at public colleges and universities. Students who meet the specific eligibility requirements—such as GPA maintenance, credit hour completion, and enrollment timelines—will benefit from the reduced financial burden of higher education costs.
Who Might Suffer?
The state government of Arkansas may be negatively impacted in terms of reduced tax revenue due to the provision of a refundable tax credit. Additionally, taxpayers or students who do not meet the strict eligibility criteria, such as those with an adjusted gross income exceeding $90,000, those attending private institutions, or those who do not maintain the required GPA and credit-hour progress, will not receive this financial assistance and may face relative economic disadvantage compared to those who qualify.
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