Alaska Paycheck Calculator 2026

Alaska Income Tax Overview

Alaska is one of only nine states with no state income tax — and uniquely, it also has no statewide sales tax. Alaska funds its government largely through oil and gas revenues. Beyond paying zero state income tax, eligible Alaska residents receive an annual Permanent Fund Dividend (PFD) — a direct cash payment funded by oil royalties — which effectively makes living in Alaska a net positive from a state tax perspective. No city in Alaska charges a local income tax. Your only deductions from your paycheck below the gross pay line are federal income tax and FICA. Compared to the national average, Alaska workers keep significantly more of their earnings at the state level. The tradeoff is a high cost of living, particularly outside Anchorage, driven by the cost of transporting goods to remote areas.