The only way your tax overpayment from Arkansas is taxable income is if you took an itemized deduction for it in 2020. Even if you did not actually get the refund in hand and you just left it in your account to be used for the following year, you still "received" the refund as a credit for the following year for an amount you deducted from your income. This would make it taxable.
If you took the standard deduction in 2020, then it would not be taxable and you should not enter it on your return.
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