Alaska Take-Home Pay Calculator

Alaska has no state income tax. Residents also receive an annual Permanent Fund Dividend.

Alaska is one of nine states with no state income tax — and arguably the most unusual among them. Alaska workers see no state income tax withholding on their paychecks, paying only federal income tax and FICA. What sets Alaska apart from every other no-tax state is the Alaska Permanent Fund Dividend (PFD): an annual cash payment made directly to eligible Alaska residents, funded by state oil revenues and Permanent Fund investment returns. The 2024 PFD was $1,702 per eligible resident; for a family of four, that amounts to approximately $6,800 per year in direct payments. This partially offsets Alaska's high cost of living — groceries, housing, and utilities in both Anchorage and rural Alaska run substantially above the national average. Alaska also has no statewide sales tax, though some municipalities like Juneau and Fairbanks impose local sales taxes ranging from 5% to 7%. The absence of both state income and state sales taxes means Alaska's revenue comes primarily from oil production taxes and Permanent Fund investment returns. Alaska's combination of zero income tax, no state sales tax, and annual PFD payment creates a uniquely low total state tax burden for residents. Workers in Alaska's dominant industries — oil and gas, commercial fishing, healthcare, and federal government contracts — benefit the most given their typically higher wages.

Living in a no-income-tax state gives you an immediate take-home pay advantage compared to workers in high-tax states. A worker earning $80,000 in Alaska takes home approximately $6,000–$8,000 more per year than an equivalent worker in California or Oregon.

However, states without income taxes often offset revenue through higher property taxes, sales taxes, or fees. When comparing the overall tax burden between states, consider all taxes — not just income tax.