How Alaska Taxes Your Paycheck
Alaska has no state income tax on wages. Your paycheck deductions in Alaska are limited to federal income tax, Social Security (6.2% up to the wage base), Medicare (1.45%), and any pre-tax benefits you elect through your employer (401(k), health insurance, FSA/HSA).
Residents receive an annual Permanent Fund Dividend (about $1,300 in 2024) — a payout funded by oil revenue.
Oil and gas, fishing, and tourism dominate Alaska's economy.
What Alaska taxes instead
Alaska is the only state with neither a wage income tax nor a statewide sales tax. Resource revenue does the work that income tax does elsewhere.
- Oil and gas revenue. Production and severance taxes on North Slope oil have historically funded a large share of the state budget, which is why Alaska can skip both income and statewide sales tax. It also makes revenue unusually sensitive to oil prices.
- Permanent Fund Dividend. Alaska pays residents an annual dividend from its sovereign wealth fund rather than taxing them. The dividend is taxable as federal income, so it appears on your federal return even though the state takes nothing.
- Local sales taxes. There is no statewide sales tax, but roughly 100 boroughs and cities levy their own. Juneau charges around 5% and Wasilla 2.5%, while Anchorage charges none — so what you pay depends entirely on where you shop.
None of this touches your paycheck — the calculator above shows federal tax and FICA only, because that is genuinely all Alaska withholds. The catch is that a bigger paycheck is not the same as a lower total burden: what the state skips on income it generally collects somewhere else. Compare against a state that does tax income using the state paycheck calculators.
Top Cities in Alaska
The largest population centers in Alaska:
- Anchorage — 287,000 residents
- Fairbanks — 31,700 residents
- Juneau — 31,900 residents
Frequently Asked Questions
What is the Alaska state income tax rate?
Alaska has no state income tax on wages. Your only mandatory paycheck deductions are federal income tax (10–37% depending on income), Social Security (6.2% up to $184,500 in 2026), and Medicare (1.45%, plus 0.9% on wages over $200K).
How much is taken out of my paycheck in Alaska?
For a single filer earning $75,000 in Alaska (2026), expect roughly $7,670 in federal income tax, $5,738 in FICA — leaving about $61,593 take-home (17.9% effective tax rate). SDI/PFML and local taxes (if any) come out of that as well.
Is the Alaska median household income enough to live comfortably?
The 2023 ACS reported a Alaska median household income of about $95,700. Whether that is "comfortable" depends heavily on city — Anchorage cost of living can differ substantially from rural areas. Use the calculator above to model your specific salary and deductions.
How does this Alaska paycheck calculator work?
We calculate your annualized gross pay based on the pay frequency you select, then apply the 2025 or 2026 IRS percentage method for federal income tax, the Alaska state tax schedule (if any), Social Security, and Medicare. Pre-tax deductions like 401(k) and Section 125 health premiums reduce your taxable base before withholding is computed. You can switch between salary and hourly modes; hourly mode applies time-and-a-half to hours over 40/week prorated by pay period.