The State of Arkansas exempts all military pay earned out of state.
In the Personal Info section of Turbo Tax, when you are on the page titled “Your personal info” be sure you click the radio button indicating you served in the military. Then, after entering the dollar amounts of your military W-2, one of the following pages will ask “Do any of these uncommon situations apply to this W-2?” Check the first box to tag the W-2 as an active duty military W-2.
NOTE: If your spouse is not an Arkansas resident, the state requires you to file as an Arkansas Resident using Married Filing Separately on Different Returns, even if you filed a joint federal return. The instructions above will not exempt your Arkansas income if you file the state jointly when you should be filing separately.
The instructions to file a separate state return after filing jointly on your federal return can be found here: