MaxGhenis · Oct 7, 2026 · Sep 26, 2026 · Oct 6, 2026 · Oct 6, 2026 · Oct 6, 2026
diff --git a/changelog.d/fix-ar-gambling-loss-deduction.fixed.md b/changelog.d/fix-ar-gambling-loss-deduction.fixed.md
@@ -0,0 +1 @@
+Count gambling winnings in Arkansas gross income and deduct Arkansas gambling losses up to those winnings, outside the 2% floor on miscellaneous itemized deductions (Ark. Code § 26-51-424(a)(2)(B), Act 155 of 2017).
diff --git a/...engine_us/parameters/gov/states/ar/tax/income/deductions/itemized/sources/individual.yaml b/...engine_us/parameters/gov/states/ar/tax/income/deductions/itemized/sources/individual.yaml
@@ -4,6 +4,8 @@ values:
     - ar_post_secondary_education_tuition_deduction
     - ar_medical_expense_deduction_indiv
     - ar_misc_deduction_indiv
+    # Gambling losses are outside the 2% floor on miscellaneous deductions.
+    - ar_gambling_loss_deduction
     - real_estate_taxes
     - charitable_deduction
     - interest_deduction
@@ -23,3 +25,21 @@ metadata:
       href: https://advance.lexis.com/documentpage/?pdmfid=1000516&crid=3e1a3c6b-c5c0-44fe-bf07-af695b4a53cc&nodeid=ABAAAFAACAAFABK&nodepath=%2FROOT%2FABA%2FABAAAF%2FABAAAFAAC%2FABAAAFAACAAF%2FABAAAFAACAAFABK&level=5&haschildren=&populated=false&title=26-51-437.+Miscellaneous+itemized+deductions+%E2%80%94+Definition.&config=00JAA2ZjZiM2VhNS0wNTVlLTQ3NzUtYjQzYy0yYWZmODJiODRmMDYKAFBvZENhdGFsb2fXiYCnsel0plIgqpYkw9PK&pddocfullpath=%2Fshared%2Fdocument%2Fstatutes-legislation%2Furn%3AcontentItem%3A4WVP-0VS0-R03J-S4P7-00008-00&ecomp=bgf5kkk&prid=0e852b49-2c9b-4c19-b9ae-e52267babbe1
     - title: Code of Arkansas-26-51-423. Deductions — Expenses.(a).(2) Medical and Dental Expense
       href: https://advance.lexis.com/documentpage/?pdmfid=1000516&crid=0c84f906-26e9-4165-a0dd-735544d09e0b&nodeid=ABAAAFAACAAFAAY&nodepath=%2FROOT%2FABA%2FABAAAF%2FABAAAFAAC%2FABAAAFAACAAF%2FABAAAFAACAAFAAY&level=5&haschildren=&populated=false&title=26-51-423.+Deductions+%E2%80%94+Expenses.&config=00JAA2ZjZiM2VhNS0wNTVlLTQ3NzUtYjQzYy0yYWZmODJiODRmMDYKAFBvZENhdGFsb2fXiYCnsel0plIgqpYkw9PK&pddocfullpath=%2Fshared%2Fdocument%2Fstatutes-legislation%2Furn%3AcontentItem%3A5W1G-MPN0-R03J-W33K-00008-00&ecomp=bgf5kkk&prid=0e852b49-2c9b-4c19-b9ae-e52267babbe1
+    - title: Arkansas Act 155 of 2017, § 21, amending Ark. Code § 26-51-424(a)(2)(B) (gambling losses are deductible to the extent of gambling winnings and not subject to the 2% limitation on miscellaneous itemized deductions)
+      href: https://www.arkleg.state.ar.us/Acts/FTPDocument?path=%2FACTS%2F2017R%2FPublic%2F&file=155.pdf&ddBienniumSession=2017%2F2017R#page=9
+    - title: Arkansas Act 155 of 2017, § 25 (effective for tax years beginning on and after January 1, 2015)
+      href: https://www.arkleg.state.ar.us/Acts/FTPDocument?path=%2FACTS%2F2017R%2FPublic%2F&file=155.pdf&ddBienniumSession=2017%2F2017R#page=10
+    - title: Arkansas DFA Subject 208, Gambling Income and Expenses (gambling losses up to gambling winnings, a miscellaneous deduction not subject to the 2% limit)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/208-GamblingIncomeExpenses.pdf#page=1
+    - title: Arkansas DFA Subject 208, 2009 version (the same rule before Act 155 of 2017)
+      href: http://web.archive.org/web/20090815162830/http://www.arkansas.gov/dfa/income_tax/documents/208-GamblingIncomeExpenses.pdf#page=1
+    - title: Arkansas 2025 Individual Income Tax Forms and Instructions (AR3 Line 27, gambling losses cannot exceed gambling winnings)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2025_AR1000F_and_AR1000NR_Instructions.pdf#page=22
+    - title: Arkansas 2025 Form AR3 (Line 27, gambling losses, among the deductions not subject to the 2% AGI limitation)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2025_AR3_ItemizedDeduction.pdf#page=1
+    - title: Arkansas 2020 Individual Income Tax Forms and Instructions (AR3 Line 27, gambling losses, first year with a separate line)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2020_AR1000F_and_AR1000NR_Instructions.pdf#page=21
+    - title: Arkansas 2019 Individual Income Tax Forms and Instructions (AR3 Line 27, other miscellaneous deductions not subject to the 2% AGI limit)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2019_AR1000F_and_AR1000NR_Instructions.pdf#page=21
+    - title: Arkansas 2015 Individual Income Tax Instructions (AR3 Line 27, other miscellaneous deductions not subject to the 2% AGI limit)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/LongBookwTaxTables_2015.pdf#page=43
diff --git a/policyengine_us/parameters/gov/states/ar/tax/income/deductions/itemized/sources/joint.yaml b/policyengine_us/parameters/gov/states/ar/tax/income/deductions/itemized/sources/joint.yaml
@@ -4,6 +4,8 @@ values:
     - ar_post_secondary_education_tuition_deduction
     - ar_medical_expense_deduction_joint
     - ar_misc_deduction_joint
+    # Gambling losses are outside the 2% floor on miscellaneous deductions.
+    - ar_gambling_loss_deduction
     - real_estate_taxes
     - charitable_deduction
     - interest_deduction
@@ -23,3 +25,21 @@ metadata:
       href: https://advance.lexis.com/documentpage/?pdmfid=1000516&crid=3e1a3c6b-c5c0-44fe-bf07-af695b4a53cc&nodeid=ABAAAFAACAAFABK&nodepath=%2FROOT%2FABA%2FABAAAF%2FABAAAFAAC%2FABAAAFAACAAF%2FABAAAFAACAAFABK&level=5&haschildren=&populated=false&title=26-51-437.+Miscellaneous+itemized+deductions+%E2%80%94+Definition.&config=00JAA2ZjZiM2VhNS0wNTVlLTQ3NzUtYjQzYy0yYWZmODJiODRmMDYKAFBvZENhdGFsb2fXiYCnsel0plIgqpYkw9PK&pddocfullpath=%2Fshared%2Fdocument%2Fstatutes-legislation%2Furn%3AcontentItem%3A4WVP-0VS0-R03J-S4P7-00008-00&ecomp=bgf5kkk&prid=0e852b49-2c9b-4c19-b9ae-e52267babbe1
     - title: Code of Arkansas-26-51-423. Deductions — Expenses.(a).(2) Medical and Dental Expense
       href: https://advance.lexis.com/documentpage/?pdmfid=1000516&crid=0c84f906-26e9-4165-a0dd-735544d09e0b&nodeid=ABAAAFAACAAFAAY&nodepath=%2FROOT%2FABA%2FABAAAF%2FABAAAFAAC%2FABAAAFAACAAF%2FABAAAFAACAAFAAY&level=5&haschildren=&populated=false&title=26-51-423.+Deductions+%E2%80%94+Expenses.&config=00JAA2ZjZiM2VhNS0wNTVlLTQ3NzUtYjQzYy0yYWZmODJiODRmMDYKAFBvZENhdGFsb2fXiYCnsel0plIgqpYkw9PK&pddocfullpath=%2Fshared%2Fdocument%2Fstatutes-legislation%2Furn%3AcontentItem%3A5W1G-MPN0-R03J-W33K-00008-00&ecomp=bgf5kkk&prid=0e852b49-2c9b-4c19-b9ae-e52267babbe1
+    - title: Arkansas Act 155 of 2017, § 21, amending Ark. Code § 26-51-424(a)(2)(B) (gambling losses are deductible to the extent of gambling winnings and not subject to the 2% limitation on miscellaneous itemized deductions)
+      href: https://www.arkleg.state.ar.us/Acts/FTPDocument?path=%2FACTS%2F2017R%2FPublic%2F&file=155.pdf&ddBienniumSession=2017%2F2017R#page=9
+    - title: Arkansas Act 155 of 2017, § 25 (effective for tax years beginning on and after January 1, 2015)
+      href: https://www.arkleg.state.ar.us/Acts/FTPDocument?path=%2FACTS%2F2017R%2FPublic%2F&file=155.pdf&ddBienniumSession=2017%2F2017R#page=10
+    - title: Arkansas DFA Subject 208, Gambling Income and Expenses (gambling losses up to gambling winnings, a miscellaneous deduction not subject to the 2% limit)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/208-GamblingIncomeExpenses.pdf#page=1
+    - title: Arkansas DFA Subject 208, 2009 version (the same rule before Act 155 of 2017)
+      href: http://web.archive.org/web/20090815162830/http://www.arkansas.gov/dfa/income_tax/documents/208-GamblingIncomeExpenses.pdf#page=1
+    - title: Arkansas 2025 Individual Income Tax Forms and Instructions (AR3 Line 27, gambling losses cannot exceed gambling winnings)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2025_AR1000F_and_AR1000NR_Instructions.pdf#page=22
+    - title: Arkansas 2025 Form AR3 (Line 27, gambling losses, among the deductions not subject to the 2% AGI limitation)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2025_AR3_ItemizedDeduction.pdf#page=1
+    - title: Arkansas 2020 Individual Income Tax Forms and Instructions (AR3 Line 27, gambling losses, first year with a separate line)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2020_AR1000F_and_AR1000NR_Instructions.pdf#page=21
+    - title: Arkansas 2019 Individual Income Tax Forms and Instructions (AR3 Line 27, other miscellaneous deductions not subject to the 2% AGI limit)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2019_AR1000F_and_AR1000NR_Instructions.pdf#page=21
+    - title: Arkansas 2015 Individual Income Tax Instructions (AR3 Line 27, other miscellaneous deductions not subject to the 2% AGI limit)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/LongBookwTaxTables_2015.pdf#page=43
diff --git a/policyengine_us/parameters/gov/states/ar/tax/income/gross_income/sources/individual.yaml b/policyengine_us/parameters/gov/states/ar/tax/income/gross_income/sources/individual.yaml
@@ -1,83 +1,95 @@
 description: Arkansas accounts for these sources when calculating the gross income.
 values:
   # Unemployment compensation was exempt income through tax year 2017.
+  # Line numbers in this block follow the TY2015-2017 AR1000F, which
+  # has no unemployment or military retirement line: pensions are on
+  # Lines 17A/17B, Schedule E on Line 18, Schedule F on Line 19 and
+  # other income on Line 20.
   2015-01-01:
     - irs_employment_income # Line 8
-    - self_employment_income # Line 8
-    - sstb_self_employment_income
+    - self_employment_income # Line 13
+    - sstb_self_employment_income # Line 13
     - interest_income # Line 10
     - dividend_income # Line 11
     - alimony_income # Line 12
-    - ar_taxable_capital_gains_indiv # Line 13
-    - taxable_ira_distributions # Line 16
-    - taxable_roth_conversions # Line 16
-    - military_retirement_pay # Line 17
-    - taxable_pension_income # Line 18
-    - disability_benefits # Line 18b
-    - rental_income # Line 19
-    - estate_income # Line 19
-    - farm_rent_income # Line 19, Form 4835 rent is reported on Schedule E
-    - farm_operations_income # Line 20, Schedule F
+    - ar_taxable_capital_gains_indiv # Line 14
+    - taxable_ira_distributions # Line 16, or Lines 17A/17B after age 59 1/2
+    - taxable_roth_conversions # Line 16, or Lines 17A/17B after age 59 1/2
+    - military_retirement_pay # Line 17A/17B
+    - taxable_pension_income # Line 17A/17B
+    - disability_benefits # Line 17A/17B
+    - rental_income # Line 18
+    - estate_income # Line 18
+    - farm_rent_income # Line 18, Form 4835 rent is reported on Schedule E
+    - farm_operations_income # Line 19, Schedule F
+    # Winnings from Arkansas electronic games of skill are not income
+    # (Ark. Code § 26-51-1310(f), Act 732 of 2007); DFA applies this to
+    # winnings before July 1, 2019. The model has a single gambling_winnings
+    # input and does not separate them.
+    - gambling_winnings # Line 20, other income (Form AR-OI)
   # Act 141 of 2017 added unemployment compensation to gross income for tax
   # years beginning on or after January 1, 2018. Act 154 of 2021 then exempted
   # it for calendar years 2020 and 2021, after which it is taxable again.
   2018-01-01:
     - irs_employment_income # Line 8
-    - self_employment_income # Line 8
-    - sstb_self_employment_income
+    - self_employment_income # Line 13
+    - sstb_self_employment_income # Line 13
     - interest_income # Line 10
     - dividend_income # Line 11
     - alimony_income # Line 12
-    - ar_taxable_capital_gains_indiv # Line 13
-    - taxable_ira_distributions # Line 16
-    - taxable_roth_conversions # Line 16
-    - military_retirement_pay # Line 17
-    - taxable_pension_income # Line 18
-    - disability_benefits # Line 18b
+    - ar_taxable_capital_gains_indiv # Line 14
+    - taxable_ira_distributions # Line 16, or Lines 18A/18B after age 59 1/2
+    - taxable_roth_conversions # Line 16, or Lines 18A/18B after age 59 1/2
+    - military_retirement_pay # Line 17 (Lines 17A/17B on the 2018 form)
+    - taxable_pension_income # Line 18A/18B
+    - disability_benefits # Line 18A/18B
     - rental_income # Line 19
     - estate_income # Line 19
     - farm_rent_income # Line 19, Form 4835 rent is reported on Schedule E
     - farm_operations_income # Line 20, Schedule F
     - unemployment_compensation # Line 21
+    - gambling_winnings # Line 22, other income (Form AR-OI)
   2020-01-01:
     - irs_employment_income # Line 8
-    - self_employment_income # Line 8
-    - sstb_self_employment_income
+    - self_employment_income # Line 13
+    - sstb_self_employment_income # Line 13
     - interest_income # Line 10
     - dividend_income # Line 11
     - alimony_income # Line 12
-    - ar_taxable_capital_gains_indiv # Line 13
-    - taxable_ira_distributions # Line 16
-    - taxable_roth_conversions # Line 16
+    - ar_taxable_capital_gains_indiv # Line 14
+    - taxable_ira_distributions # Line 16, or Lines 18A/18B after age 59 1/2
+    - taxable_roth_conversions # Line 16, or Lines 18A/18B after age 59 1/2
     - military_retirement_pay # Line 17
-    - taxable_pension_income # Line 18
-    - disability_benefits # Line 18b
+    - taxable_pension_income # Line 18A/18B
+    - disability_benefits # Line 18A/18B
     - rental_income # Line 19
     - estate_income # Line 19
     - farm_rent_income # Line 19, Form 4835 rent is reported on Schedule E
     - farm_operations_income # Line 20, Schedule F
+    - gambling_winnings # Line 22, other income (Form AR-OI)
   2022-01-01:
     - irs_employment_income # Line 8
-    - self_employment_income # Line 8
-    - sstb_self_employment_income
+    - self_employment_income # Line 13
+    - sstb_self_employment_income # Line 13
     - interest_income # Line 10
     - dividend_income # Line 11
     - alimony_income # Line 12
-    - ar_taxable_capital_gains_indiv # Line 13
-    - taxable_ira_distributions # Line 16
-    - taxable_roth_conversions # Line 16
+    - ar_taxable_capital_gains_indiv # Line 14
+    - taxable_ira_distributions # Line 16, or Lines 18A/18B after age 59 1/2
+    - taxable_roth_conversions # Line 16, or Lines 18A/18B after age 59 1/2
     - military_retirement_pay # Line 17
-    - taxable_pension_income # Line 18
-    - taxable_401k_distributions # Line 18
-    - taxable_403b_distributions # Line 18
-    - taxable_sep_distributions # Line 18
-    - keogh_distributions # Line 18
-    - disability_benefits # Line 18b
+    - taxable_pension_income # Line 18A/18B
+    - taxable_401k_distributions # Line 18A/18B
+    - taxable_403b_distributions # Line 18A/18B
+    - taxable_sep_distributions # Line 18A/18B
+    - keogh_distributions # Line 18A/18B
+    - disability_benefits # Line 18A/18B
     - rental_income # Line 19
     - estate_income # Line 19
     - farm_rent_income # Line 19, Form 4835 rent is reported on Schedule E
     - farm_operations_income # Line 20, Schedule F
     - unemployment_compensation # Line 21
+    - gambling_winnings # Line 22, other income (Form AR-OI)
 
 metadata:
   unit: list
@@ -94,6 +106,20 @@ metadata:
       href: https://www.dfa.arkansas.gov/wp-content/uploads/AR1000FandAR1000NRInstructions.pdf#page=5
     - title: Arkansas 2025 Individual Income Tax Forms and Instructions
       href: https://www.dfa.arkansas.gov/wp-content/uploads/2025_AR1000F_and_AR1000NR_Instructions.pdf#page=13
+    - title: Arkansas 2025 Individual Income Tax Forms and Instructions (gambling winnings are subject to tax, reported on Form AR-OI line 4 and carried to Line 22)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2025_AR1000F_and_AR1000NR_Instructions.pdf#page=14
+    - title: Arkansas 2025 Form AR-OI (line 4, gambling winnings, an addition to income)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2025_AR-OI_OtherIncomeLoss_and_DepreciationDifferences.pdf#page=1
+    - title: Arkansas 2019 Individual Income Tax Forms and Instructions (gambling winnings are subject to tax)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/2019_AR1000F_and_AR1000NR_Instructions.pdf#page=13
+    - title: Arkansas 2018 Individual Income Tax Instructions (gambling winnings of any type, except from Arkansas electronic games of skill; other income on Line 22)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/AR1000FandAR1000NRInstructions_2018.pdf#page=13
+    - title: Arkansas 2015 Individual Income Tax Instructions (gambling winnings of any type, except from Arkansas electronic games of skill; other income on Line 20)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/LongBookwTaxTables_2015.pdf#page=15
+    - title: Arkansas 2015 Form AR1000F (TY2015-2017 income lines; Schedule C on Line 13, pensions on Lines 17A/17B, Schedule E on Line 18, Schedule F on Line 19, other income on Line 20)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/LongBookwTaxTables_2015.pdf#page=17
+    - title: Arkansas 2018 Form AR1000F (TY2018 and later income lines; Schedule C on Line 13, pensions on Lines 18A/18B, Schedule E on Line 19, other income on Line 22)
+      href: https://www.dfa.arkansas.gov/wp-content/uploads/AR1000FandAR1000NRInstructions_2018.pdf#page=15
     - title: Arkansas 2022 AR1000F Instructions
       href: https://www.dfa.arkansas.gov/wp-content/uploads/2022_AR1000F_and_AR1000NR_Instructions.pdf#page=13
     - title: 2022 Arkansas AR1000F
Original file line number	Diff line number	Diff line change
		@@ -0,0 +1 @@
		Count gambling winnings in Arkansas gross income and deduct Arkansas gambling losses up to those winnings, outside the 2% floor on miscellaneous itemized deductions (Ark. Code § 26-51-424(a)(2)(B), Act 155 of 2017).