How to Pay Alaska State Taxes?

As a small business owner, you need to understand your Alaska state taxes and how they differ from the rest of America. Unlike other states, Alaska doesn’t levy individual income taxes or a state sales tax, but it does have a state unemployment insurance (UI) tax, local sales taxes, and industrial activity taxes. In addition, many Alaskan cities and boroughs charge their own local taxes on things like alcohol, tobacco, raw fish, hotels, and gaming.

Alaska’s UI tax is a employer-paid tax that funds state unemployment benefits for workers who lose their jobs. The tax is based on your company’s payroll and your employees’ wages. If you employ people from other states, you may need to use a reciprocal agreement with those states to avoid having them pay twice as much in UI taxes.

Unlike most states, Alaska doesn’t have a state income tax but a business activity tax, also called the Alaska Corporate Income Tax. This is a state tax on your company’s revenue and investment earnings, and it is due quarterly. You can file and pay this tax through myAlaska, and you can learn more about it by visiting the Department of Labor’s Business Activities Tax webpage. You may also need to register your business for a state sales tax, called the Alaska Retailers’ Tax, if you do business in the state.

In Alaska, state tax payments can be made online through Revenue Online or via wire transfer for larger amounts. Specifically, any payment of $100,000 or greater for estimated taxes or $150,000 or greater for tax returns must be completed through these methods. Additionally, electronic payments are required for all state disbursements, with few exceptions​ (Revenue Online)​. For more details, you can visit the Alaska Revenue Online Help page.

Alaska State Tax Payment Methods

The state of Alaska has numerous credit card merchant accounts that allow it to accept online payments from customers and business partners. However, the exact payments that can be made this way depend on the individual state agency collecting the payments. In addition to these payment methods, the state also has an electronic ACH system called Beaches that allows authorized agencies to transfer and receive ACH transactions. This system is managed by the State’s Cash Management section.

Here is the summary of ways to pay your Alaska state taxes:

• Traditional methods: You can pay by check, money order, or cashier’s check.
• Electronic options: The state is proposing new regulations that may allow for credit card, ACH debit/credit payments, and wire transfers in the future. However, these options are not widely available yet.
• Third-party processors: Some local governments in Alaska allow you to pay taxes online through a third-party processor, often with a convenience fee. Be sure to check with your local tax authority for their specific options.