Ark. Code Ann. § 26-18-507 (2026)
Claims for refunds of overpayments
History. Acts 1979, No. 401, § 26; 1983, No. 379, § 24; A.S.A. 1947, § 84-4726; Acts 1997, No. 1139, §§ 8, 9; 1999, No. 1277, §§ 7, 8; 1999, No. 1373, § 1; 2003, No. 1718, § 9; 2011, No. 789, § 1.
A.C.R.C. Notes. Acts 1997, No. 1139, § 10, provided: “The General Assembly intends, by the passage of this amendment to the provisions of the Arkansas Tax Procedure Act, to clarify its intent that taxpayers involved in state tax disputes with the Arkansas Department of Finance and Administration shall have, as much as possible, the opportunity to secure an objective review of their dispute by a court at law through: (1) the posting of bond method; (2) the payment after assessment method; or (3) the claim for refund method, after the payment by the taxpayer of all state taxes claimed to be due from the taxpayer for at least one complete taxable period involved in the audit period. It is also intended by the General Assembly that the courts of this state are to recognize the ‘divisible tax theory’ applicable to the review of federal tax dispute by federal courts, as also being applicable to the review of state tax disputes by the courts of this state.”
Amendments. The 2011 amendment added “subject to subsection (e) of this section” at the end of (a)(1); and rewrote (e)(1)(B).
Research References
ALR.
Voluntary payment doctrine as bar to recovery of payment of generally unlawful tax. 1 A.L.R.6th 229.
Construction and operation of statutory time limit for filing claim for state tax refund. 14 A.L.R.6th 119.
Ark. L. Rev.
Case Note, Pledger v. Illinois Tool Works, Inc.: Arkansas Belatedly Recognizes the Unitary Business Principle as a Limitation of Its Power to Tax Capital Gains of Nondomiciliary Corporations, 45 Ark. L. Rev. 597.
U. Ark. Little Rock L. Rev.
Nichols, Civil Procedure — The End of the Class Action in Multi-Taxpayer Litigation Seeking Refunds of State Taxes, ACW Inc. v. Weiss, 29 Ark. 302, 947 S.W.2d 770 (1997), 21 U. Ark. Little Rock L. Rev. 151.
Case Notes
Applicability.
This section deals with a taxpayer's overpayment through “error of fact, computation, or mistake of law,” and does not apply to payment made under protest. Taber v. Pledger, 302 Ark. 484, 791 S.W.2d 361, cert. denied, 498 U.S. 967, 111 S. Ct. 429, 112 L. Ed. 2d 413 (1990).
Where a taxpayer challenges a tax statute as patently unconstitutional, rather than unconstitutional in its application, the taxpayer is not required to file a refund claim for the State to waive sovereign immunity. Carson v. Weiss, 333 Ark. 561, 972 S.W.2d 933 (1998).
Where a taxpayer did not appeal a final assessment, but instead filed a verified claim for refund and for abatement, the suit was not timely; further, the plain language demonstrated that this section applied only to those cases where a taxpayer had erroneously or mistakenly overpaid taxes, and not where a taxpayer paid the amount assessed deliberately in order to challenge a final assessment of additional taxes following an audit. Baker Refrigeration Sys. v. Weiss, 360 Ark. 388, 201 S.W.3d 900 (2005).
Class Action.
There must be full compliance with former subdivision (e)(2)(A) [see now (e)(3)] before sovereign immunity is waived; therefore, where only one taxpayer has claimed a refund, no taxpayer class action can be certified. State, Dep't of Fin. & Admin. v. Staton, 325 Ark. 341, 942 S.W.2d 804 (1996), overruled in part on other grounds, Bd. of Trs. of the Univ. of Ark. v. Andrews, 2018 Ark. 12, 535 S.W.3d 616 (2018); State, Dep't of Fin. & Admin. v. Tedder, 326 Ark. 495, 932 S.W.2d 755 (1996), overruled in part, Bd. of Trs. of the Univ. of Ark. v. Andrews, 2018 Ark. 12, 535 S.W.3d 616 (2018).
In action by taxpayers for refunds, chancellor lacked authority to certify as members of class taxpayers who had not filed refund claims, because sovereign immunity was waived only for plaintiffs who had followed the procedure outlined in this section. ACW, Inc. v. Weiss, 329 Ark. 302, 947 S.W.2d 770 (1997).
Cited: Pledger v. Ethyl Corp., 299 Ark. 100, 771 S.W.2d 24 (1989); Pledger v. Bosnick, 306 Ark. 45, 811 S.W.2d 286 (1991); Baker Refrigeration Sys. v. Weiss, 360 Ark. 388, 201 S.W.3d 900 (2005).