However, the arduino pins can only supply 40mA,
QuoteHowever, the arduino pins can only supply 40mA,No. The arduino will get fried if you try to pull more than 40mA from it. It is very easy to do this....You should not take more than 30mA in any good design.The 1K series resistor is too high, you should use something between 200 to 500 ohms.
- the output from the Arduino?- the input to the arduino.
your opto-islolator may not be working.
Is the device using inverted TTL?
Why are you bringing RX low when the other side brings that pin high?
Where is 1KOhm calculated for the TX resistor?
*(Hint: connect RX to the Emitter and +5V to the Collector)