Tags: Retirement | retirement | Alaska | taxes

Taxes for Retirees in Alaska

By    |   Saturday, 30 May 2015 01:23 PM

When it comes to how much you will be paying in taxes, Alaska is one of the best places in America to retire. Not only does the state have low taxes overall, but it also has specific tax breaks for retirees and no inheritance or estate taxes.

"Alaska is a tax haven for retirees. Alaska has no income tax or sales tax, and the state doesn't tax pension or Social Security income," according to a U.S News & World Report story about the best places to retire from a tax perspective.

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This tax break can be a very good thing in today's climate of economic unrest. "The baby boomer generation is coming into retirement on the heels of one of the worst economic downturns in decades," attorney Kathleen Thies, state tax analyst with CCH, a tax software and publishing company in Chicago tells Bankrate. "What they have to pay in taxes can have a significant impact on their finances and overall cost of living in their retirement years."

Alaska also has the second-lowest tax burden of any state, according to the Tax Foundation, which estimates the tax burden at 7 percent of income, below the national average of 9.8 percent. Alaska's taxpayers pay about $3,319 per capita in state and local taxes.

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When it comes to property taxes only 25 state municipalities even levy them, meaning in many areas you will not pay any taxes on your home. Finally, Alaska does not have an inheritance tax and its estate tax is limited to what the federal government collects.

In addition to low taxes, once you become a permanent resident of Alaska you can expect to get paid each year for living in the sate. The royalties comes from the Alaska Permanent Fund, which mandates that a percentage of profits made from oil and minerals are given back to the community. What residents are paid depends on how well the fund performs on a certain year. In 2013, according to the AARP that payout was $900.

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When it comes to how much you will be paying in taxes, Alaska is one of the best places in America to retire. Not only does the state have low taxes overall, but it also has specific tax breaks for retirees and no inheritance or estate taxes.
retirement, Alaska, taxes
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2015-23-30
Saturday, 30 May 2015 01:23 PM
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