taxes

State taxes: Alaska

Taxes » Income Taxes » State Taxes » Alaska

Alaska is the only state that does not collect state sales tax or levy an individual income tax. To finance state operations, Alaska depends primarily on petroleum revenues. Some of its cities and other local jurisdictions, however, do collect sales tax revenue. More on Alaska taxes can be found in the tabbed pages below.

Personal income tax

Alaska is the only state that does not collect state sales tax or levy an individual income tax on any type of personal income, either earned or unearned.

Instead, every Alaskan, children as well as adults, receives a payment each year from the Alaska Permanent Fund Corporation. Residents can apply online for this money, known as the Permanent Fund Dividend, or PFD, via the myAlaska program.

To finance state government operations, Alaska depends primarily on petroleum revenues. The Department of Revenue's Tax Division reports regularly on the state's revenue sources.

The Department also issues an annual overview of its operations, including new state laws that directly affect the tax division. You can select from various reports at the Tax Division's search page.

Sales taxes

While Alaska does not charge a state sales tax, it does impose a vehicle rental tax text (10 percent on passenger vehicles; 3 percent on RVs), as well as an excise tax of $34.50 per voyage on passengers traveling on commercial vessels that provide overnight accommodations while in Alaska waters.

On the local level, 62 municipalities collect a general sales tax, with a range of between 1 percent and 7 percent. Specific local taxes and rates are available at the State Assessor's searchable database. Contact information for Alaska's municipal taxing jurisdictions can be found in the state's directory.

Other types of local taxes levied include raw fish taxes, hotel and motel "bed" taxes, severance taxes, liquor and tobacco taxes, gambling (pull tabs) taxes, tire taxes and fuel transfer taxes.

A percentage of revenue collected from certain state taxes and license fees (e.g., petroleum, aviation motor fuel, telephone cooperative) is shared with municipalities in Alaska. For a look at the distribution of these funds, select a shared tax year report at the Tax Division's search page.

Personal and real property taxes

Alaska is the largest state, but only a small portion of the land mass is subject to a property tax. Only 25 Alaskan municipalities, either cities or boroughs, levy a property tax. The average per capita property tax paid in 2012 in all municipalities, excluding oil and gas properties, was $1,379.

For its citizens age 65 or older and disabled veterans, Alaska exempts the first $150,000 of assessed value from property taxes.

Details on local property taxes can be found in Alaska Taxable, the Commerce Department's official annual report to the Alaska State Legislature on local sales and property taxes.

Residents should contact their local assessor's office for specific tax-related information.

Inheritance and estate taxes

There is no inheritance tax in Alaska.

In accordance with the repeal of the federal state death tax credit, for decedents who died after Dec. 31, 2004, the Alaska Department of Revenue no longer requires executors to file a Preliminary Notice and Report or a copy of the federal estate tax return with the state.

Other Alaska tax facts

Want to know the prevailing price of a barrel of oil? Check the Alaska Tax Division's home Web page.

Alaska residents can pay permit and license fees online at no extra cost. Starting in April 2014, the Alaska Department of Revenue will expand the service. Updates will be posted on the Tax Division's TRMS page as the new service's operational date nears.

In Alaska, intangible personal property is exempt from taxation.

Additional state tax and fee information is available at the Alaska Department of Revenue website.

To download tax forms on this site, you will need to install a free copy of Adobe Acrobat Reader. Click here for instructions.

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