Live in Texas, Work Remotely for a Arkansas Employer: Who Taxes You?
Answer
This is the best case in the whole matrix. Living in a no-income-tax state and working remotely for an employer in Arkansas — a state with no convenience rule — means no state withholding and no state return anywhere. Check that your employer is not withholding Arkansas tax by mistake.
Last verified
An employer's address is not a tax nexus for its employees. Working from Texas keeps the income Texas-source, and since Texas levies no tax on wages, the income lands nowhere at all.
What you file
There is nothing to file in either Texas or Arkansas on these wages. Your federal return is unaffected — the federal government taxes the income whatever the states do.
The two states, side by side
| Texas | Arkansas | |
|---|---|---|
| Taxes wages | No | Yes — graduated |
| Reciprocity partners | None | None |
| Convenience rule | No | No |
| Nonresident return | Not applicable | Form AR1000NR |
| Credit for other-state tax | No income tax | Form AR1000TC |
| Nonresident safe harbour | Not applicable | None published |
| Local income tax | No | No |
| Revenue department | Texas Comptroller of Public Accounts | Arkansas Department of Finance and Administration |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Arkansas and working in Texas gives:Home state only.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: Texas → ArkansasWork state only
- 1099 contractor: Texas → ArkansasClient state only, if you work there
- Moved mid-year: Texas → ArkansasOne part-year return — the state you moved to
Other Texas pairs
Questions people actually ask
I live in Texas and work remotely for a Arkansas employer. Which state do I pay?
This is the best case in the whole matrix. Living in a no-income-tax state and working remotely for an employer in Arkansas — a state with no convenience rule — means no state withholding and no state return anywhere. Check that your employer is not withholding Arkansas tax by mistake.
Which state should my employer be withholding for?
Neither. There is no state income tax to withhold on either side of this pairing, so a state line on your pay stub for Texas or Arkansas is an error worth querying.
Does my Arkansas employer's location alone create a Arkansas tax obligation?
No. Arkansas sources wages to the place where the work is physically performed, and it does not apply a convenience-of-the-employer rule that would override that. Days you actually spend working inside Arkansas are a different matter — those are Arkansas-source income and can require a nonresident return.
How current is this?
The Texas and Arkansas rules on this page were last checked against Texas Comptroller of Public Accounts and Arkansas Department of Finance and Administration on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Texas Comptroller of Public Accounts — individual income taxaccessed 2026-08-07
- Arkansas Department of Finance and Administration — individual income taxaccessed 2026-08-07