The proposed bill introduces a new education tax in Alaska, imposing a four percent tax on taxable income exceeding $150,000 for individuals filing separately and $300,000 for those filing jointly. It also establishes an annual tax of $150 on individuals with self-employment income. The bill outlines tax calculations for nonresident individuals and includes specific provisions for trusts and estates, with exemptions for certain types of trusts. Additionally, it repeals existing tax credits under the Alaska Net Income Tax Act and mandates electronic submissions for tax returns to streamline the tax reporting process.

The legislation further clarifies the taxation of income from state sources, detailing taxable income types and regulations for partnerships and S corporations. It requires employers to withhold taxes from wages and provides guidelines for partnerships regarding nonresident partners. The bill also includes amendments related to permanent fund dividends, allowing individuals to direct withholdings for tax liabilities. By incorporating sections of the Internal Revenue Code, the bill aims to enhance tax administration and compliance while establishing an early education fund funded by the new tax. The changes are set to take effect on January 1, 2026, with certain provisions being repealed by that date.

Statutes affected:
HB0152A, AM HB 152, introduced 03/24/2025: 43.05.045, 43.22.075, 43.05.220, 43.22.015, U.S.C, 43.22.010, 43.22.030, 43.22.045, 43.22.020, 13.36.215, 43.22.025, 43.20.144, 43.22.035, 43.22.040, 43.22.050, 43.22.055, 43.22.060, 43.22.065, 43.22.070, 43.22.080, 43.22.085, 43.22.090, 43.23.005, 43.22.095, 43.22.100, 43.22.105, 43.05.230, 43.22.110, 14.03.420, 43.22.150, 43.05.085, 43.20.012, 43.20.013