Please check the underlined sentence below...
Did you have a military pension? In Arkansas, you can choose to exclude the entire military pension, or you can choose to add the military pension to other pensions and take the $6,000 exclusion.
Also, did you check that you would take the "65 Special" credit of $26 on line 7A? If you did, then you do not get the $6,000 pension exclusion.
For background, see the AR1000F instructions on page 11, line 7a, and page 12, lines 17-18.
Also see this answer for another taxpayer:
A taxpayer can choose to take the exclusion for all the military retirement benefit, or waive that and add the military retirement benefit to the other retirement benefits and apply the $6,000 exclusion. You cannot exclude the total military retirement benefit AND take the $6,000 exemption.
This is laid out in an opinion issued by the Arkansas Department of Finance and Administration (www.ark.org/dfa-act896/index.php/api/document/download/20180814.pdf) The opinion is full of legalese, but the salient line is
"A taxpayer claiming an exemption under subsection (e) of this section is not eligible for an exemption under subsection (a) of this section."
Subsection (e) refers to the total exemption of military retirement benefits; subsection (a) refers to $6,000 exclusion.
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