About this programme
The Equity Investment Incentive Program, run by the Arkansas Economic Development Commission (AEDC) together with the Arkansas Development Finance Authority (ADFA), is a discretionary incentive targeted at new, technology-based businesses that pay wages above the state or county average. It exists to help a qualifying company attract investment on terms and conditions that would not otherwise be available without the incentive.
It works by letting an approved business offer investors an Arkansas income tax credit in exchange for an equity investment in the business. The credit goes to the investor, not to the business itself; the business's role is to get approved so it can offer the incentive when raising capital.
How it works
The income tax credit issued under the program equals 33 1/3% of the amount an investor puts into an eligible business.
An investor can use the credit to offset up to 50% of their Arkansas income tax liability in any one tax year. Any unused credit can be carried forward for up to nine years.
With AEDC approval, the income tax credit can be sold, but only once, and the sale must happen within one year of issuance. If it isn't sold within that window, the credit can only be used to offset the holder's own Arkansas state income tax liability.
To get a company approved, an applicant submits an application to AEDC, which reviews it for program compliance. AEDC and ADFA then schedule an in-person investor pitch meeting, and the two agencies jointly decide whether to approve the company, using discretionary criteria. A company that isn't approved can reapply without restriction, though AEDC weighs the company's actual performance against its previous projections when it does.
Who can apply
The program targets new, technology-based businesses paying wages in excess of the state or county average wage.
Frequently asked
Who actually gets the tax credit, the company or the investor?
The investor. The program lets an approved business offer investors an income tax credit worth 33 1/3% of their investment; the business itself doesn't receive the credit.
How much of my Arkansas tax bill can the credit offset?
Up to 50% of your Arkansas income tax liability in any one tax year, with any unused credit carried forward for up to nine years.
Can I sell an unused credit?
Yes, but only once and only within one year of issuance, and only with AEDC's approval. After that one-year window, the credit can only be used to offset the holder's own Arkansas state income tax.
How does a company get approved to offer this incentive?
The company submits an application to AEDC, which reviews it for compliance. AEDC and ADFA then hold an in-person investor pitch meeting and jointly decide on approval using discretionary criteria.
What if my company isn't approved the first time?
You can reapply without restriction, though AEDC will look at how the company's actual results compared to the projections in the earlier application.
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Reviewed 2026-09-25. Programmes change, so check eligibility, amounts and deadlines on the official page before you apply. CapEasy is a private firm and is not part of any government body.