State Income Taxes in Alaska
Alaska is one of nine states that has no personal income tax. The other states are:
Alaska also has a Permanent Fund Dividend (PFD) that gives it’s residences extra money every year to live in Alaska. The PFD was $992 in 2020 and $1,114 in 2021.
State Business Taxes in Alaska
The state of Alaska does have a business income tax. Like most states with income tax, it is calculated on a marginal scale whose range is from 0% to 9.40% for 2021. For other business entities that are flow-thru entities, such as S Corporations, Partnerships, LLCs, etc., since it flows-thru to the individual level, there is no business tax on those entities. In other words, the tax is accessed on C Corporations.
|Tax Rate||Corporate Tax Brackets|
|0.00%||$0 – $25,000|
|2.00%||$25,001 – $49,000|
|3.00%||$49,000 – $74,000|
|4.00%||$74,000 – $99,000|
|5.00%||$99,000 – $124,000|
|6.00%||$124,000 – $148,000|
|7.00%||$148,000 – $173,000|
|8.00%||$173,000 – $198,000|
|9.00%||$198,000 – $222,000|
|9.40%||$222,000 and above|
Sales and Property Taxes in Alaska
Sales Tax – sales tax in Alaska is unusual because there is no State level sales tax, however there are local sales tax rates. In Alaska, the average local Sales tax rate is 1.76%
Property Taxes in Alaska – the average property tax rate for residential property in the state of Alaska is 0.98% making it close to the national average of 1.03%. The state of Alaska also has property tax exemptions in the following cases:
- Owner occupied – 20% exemption up to $50K
- Senior Citizen – exemption up to $150K
- Military – exemption up to $150K
Learn more about the exemptions at the Municipality of Anchorage website.
Payroll Taxes in Alaska
Unemployment taxes usually consist of three factors. They are the wage base, range of rates, number of schedules. Below is an outline of the three.
- Wage Base – Alaska has a high wage base of $41,500 for 2021
- UI Rates – range from 1.00% to 5.40%
- Schedules – Alaska has multiple schedules regarding UI taxes
Alaska Business Entities – LLCs
Alaska is one of the best states in the country to set up your LLC. Here are some important facts:
- Alaska’s LLC fee is bi-annual (paid once every two years) at $150
- When you initially register, you pay an additional one time fee of $250
- Secretary of State of Alaska website – click here