Arkansas covid treatment is here. The state offers coverage of taxes in Moving to Arkansas. It looks like you paid tax on the full amount in 2020 on your state return. Arkansas does not use the federal AGI, it is state specific with no mention of the federal treatment.
On the federal, you can input how much you have repaid and deduct that from your tax bill. Arkansas will benefit by taxing the money again when you withdraw it unless the state determines a policy to allow handling of the issue at the state level for repaid amounts.
The final word, Update and Answers to Questions on Federal CARES Act.
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