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Taxation & Assessment

Property Tax

Introduction

Alaska is the only state in the United States where a large part of the land mass of the state is not subject to a property tax. Although property tax is the primary method of raising revenues for the majority of the larger municipalities in the state, smaller municipalities favor a sales tax. This is due primarily to the fact that the smaller incorporated areas lack a sufficient tax base to support the property tax. The unincorporated areas of the state do not have the legal authority to levy a tax.

Narrative

For those areas that do have a property tax, it must be assessed and taxed as authorized by AS 29.45.010 - .600. All property is taxable unless specifically exempted by law. Property required to be exempt from the property tax includes property owned by local, state, and federal governments, except that a private leasehold, contract, or other interest in that property, including the use of that property by an individual, company, or corporation, is taxable to the extent of that interest. Other required exemptions include senior citizens and disabled veterans, as well as property used for non-profit educational, religious, hospital, charitable and cemetery purposes. Required exemptions can be found in AS 29.45.030. Municipalities are given wide latitude to exempt all or some categories of personal property as well as other types or uses of property. These optional exemptions can be found in AS 29.45.050.

Property is required to be valued at market value each and every year as of January 1. Reinspection of property is to be made in accordance with a resolution or an ordinance of the local governing body but the inspection cycle should not exceed more than six (6) years.

Frequently Asked Questions

What cities or boroughs levy a property tax?

Fourteen of the eighteen organized boroughs levy a property tax. Only eleven cities outside of organized boroughs levy a property tax. These twenty-five municipalities can be found on the Directory of Taxing Jurisdictions.

Are both real and personal property taxable in Alaska?

Yes. AS 29.45.010 allows for the assessment and taxation of both real and personal property. There are several municipalities that have chosen to exempt some or all categories of personal property. For a listing of those municipalities and categories, see the department's publication of "Alaska Taxable."

Can the tax rates be less in a borough for outlying, remote areas?

No. Under AS 29.45.090, property upon which a tax is levied is taxed at the same rate for the year throughout the municipality. This excludes service area rates since they are unique to each service area.

How is the mill rate or tax levy calculated?

The governing body (city council or the borough assembly) determines the budget requirements for a municipality and identifies all revenue sources. After all other revenue sources are identified and the budgeted amount is reduced by that amount, the residual is the amount required to be raised by the property tax. That amount is divided by the total assessed value and the result is identified as a "mill rate". A "mill" is 1/1000 of a dollar, so the mill rate simply states the amount of tax to be charged per $1,000 of assessed value. For example, a mill rate of 18.5 mills equates to $18.50 of tax per $1,000 of assessed value. Under this scenario, a property assessed at $100,000 would have a tax liability of $1,850 annually.

May I appeal the tax rate I have to pay?

You may not appeal the mill rate you have to pay. An appeal is limited to only the assessed value and the only grounds for an appeal is proof of unequal, excessive, improper or under-valuation. The tax is simply a matter of a mathematical calculation of the mill rate and the assessed value. Neither the assessor nor the Board of Equalization has the authority to set or reduce the tax rate, as that is set at the governing body level. The time to argue the tax rate is at the city/assembly budget hearings.

Is there a cap on the amount of property taxes that a municipality may levy?

Yes. In accordance with AS 29.45.090 a municipality may not levy a tax in excess of three percent (30 mills).  This limitation does not apply to taxes pledged to pay for bonded debt or service areas, both of which are taxes requested by the electorate.

Applicable Laws and Regulations

Alaska Constitution

  • Article X, Section 1  Provision for maximum local self government and non-duplication of taxing jurisdictions.
  • Article X, Section 2  Dedication of taxing powers to boroughs and cities only.
  • Article IX, Section 1  Taxing power, prohibitions.
  • Article IX, Section 2  Non-discrimination in tax rate.
  • Article IX, Section 3  Assessment standards, prescribed by law.
  • Article IX, Section 4  Exemptions, authority to prescribe additional exemptions by law.
  • Article IX, Section 5  Government property, taxability of private use of otherwise exempt property.
  • Article IX, Section 6  Public purpose use of tax revenue.
  • Article X, Section 1  Provision for maximum local self government and non-duplication of taxing jurisdictions.

Alaska Statutes

  • AS 14.17.510  Assistance to school districts and municipalities in determining full and true value.
  • AS 29.10.200  Limitation on home rule powers, taxation, assessment, collections, exemptions.
  • AS 29.25.010  Acts required to be by ordinance, levy taxes, establish penalty.
  • AS 29.25.030  Prohibition against levying taxes by emergency ordinance.
  • AS 29.35.010  General powers and duties of municipality, authorization to levy tax, enforce ordinances.
  • AS 29.35.170  Assessment and collection of tax, borough collection of city tax.
  • AS 29.45.010  Authority to levy a property tax, areawide, nonareawide, service area, home rule, first class second class.
  • AS 29.45.020  Taxpayer notice, format, delivery.
  • AS 29.45.030  Taxable property and mandatory exemptions, application for exemption, ordinance establishing procedures and deadlines, waiver for late application, state reimbursement for exemptions, definitions.
  • AS 29.45.040  Property tax equivalency payments, application process.
  • AS 29.45.046  River habitat protection credit, eligibility, calculation method, exemptions.
  • AS 29.45.050  Optional exemptions, ordinance ratification, mandatory cap on exemptions, home-rule provisions.
  • AS 29.45.055  Levy of flat tax on personal property exempted from ad valorem tax.
  • AS 29.45.060  Farm or agricultural land.
  • AS 29.45.062  Land subject to a conservation easement.
  • AS 29.45.065  Assessment of private airports open for public use.
  • AS 29.45.070  Mobil homes, classification.
  • AS 29.45.080  Tax on oil and gas production and pipeline property, DOR valuation.
  • AS 29.45.090  Tax Limitation and mill rate equity.
  • AS 29.45.100  No limitation to pay for bonds.
  • AS 29.45.103  Taxation records, availability.
  • AS 29.45.105  Errors in taxation procedures, state assessor notice, appeal.
  • AS 29.45.110  Full and true value, assessment date, low income housing credit valuation and exemption.
  • AS 29.45.120  Returns.
  • AS 29.45.130  Independent investigations.
  • AS 29.45.140  Violations; authorization to prescribe penalties by ordinance.
  • AS 29.45.150  Reevaluation.
  • AS 29.45.160  Assessment roll.
  • AS 29.45.170  Assessment notice.
  • AS 29.45.180  Corrections.
  • AS 29.45.190  Appeal.
  • AS 29.45.200  Board of Equalization.
  • AS 29.45.210  Hearing.
  • AS 29.45.220  Supplementary assessment rolls.
  • AS 29.45.230  Tax adjustments on property affected by a natural disaster, sworn statement, notice, equalization hearing, deadline for determining rate and mailing statements.
  • AS 29.45.240  Establishment of levy and determination of rate, ordinance and resolution requirement.
  • AS 29.45.250  Rates of penalty and interest, limitation on rate, interest accrual.
  • AS 29.45.550  Cities outside boroughs.
  • AS 29.45.560  Cities inside boroughs.
  • AS 29.45.580  Differential tax zones.
  • AS 29.45.590  Limited property taxing power for second class cities.
  • AS 29.45.600  Combining property tax with incorporation of a second class city.
  • AS 29.60.010  State revenue sharing tax equalization formula.
  • AS 29.60.080  Definitions.
  • AS 44.33.020(17) Commerce assistance on valuation, assessment, and taxation; notification of errors.
  • AS 43.56.010  Levy of municipal tax on oil and gas exploration, production, and pipeline property, limitation on tax assessment rate.
  • AS 43.56.020  Exemptions on levy of municipal tax on oil and gas exploration, production, and pipeline property.
  • AS 43.56.030  Taxes levied are in place of.
  • AS 43.56.040  State assessment review board.
  • AS 43.56.060  Commerce assessment of oil and gas and pipeline property subject to taxation.
  • AS 43.82.210  Payment in lieu of taxes on stranded gas development projects.

Alaska Administrative Code

  • 3 AAC 131.010-.020  Certification and notification of population for oil & gas property tax limitations, alternate population determination methods.
  • 3 AAC 131.030  Definitions.
  • 3 AAC 135.010 - .085 Senior citizen and disabled veteran exemptions, method of application and forms, deadlines and calculations, eligibility of spouse.
  • 3 AAC 135.095  Effect of exemption on other legal encumbrances.
  • 3 AAC 135.110  Appeal.
  • 3 AAC 135.120  Definitions.
  • 3 AAC 136.010-.045  Senior citizen and disabled veteran property tax equivalency payment forms, rent verification, eligibility, eligible costs, age verification, veteran's disability verification, computation of payment.
  • 3 AAC 136.060  Definitions.
  • 3 AAC 138.010-.020  Farm and agricultural land assessment and deferment application forms, income verification.
  • 3 AAC 138.030  Appeal.
  • 3 AAC 138.040-.050  Municipal maintenance of agricultural land records, confidentiality.
  • 3 AAC 138.060  Definitions.
  • 3 AAC 139.010  State assessor review of written complaint, review of municipal records.
  • 3 AAC 139.020  State assessor notification of error.
  • 3 AAC 139.030  Appeal of state assessor's determination.
  • 3 AAC 139.900  Definitions.
  • 15 AAC 56.00-.010  Oil and gas exploration production and pipeline property tax, filing property statement with state, notice of assessment, municipal notification.
  • 15 AAC 56.015-.045  Standing to appeal, appeal to state, appeal to assessment review board, assessment review board hearing, supplementary assessments.
  • 15 AAC 56.050-.065  Credit and refund of oil & gas property tax, payment due date.
  • 15 AAC 56.070  Average per capita full and true value determination and notification.
  • 15 AAC 56.075-.110  Taxable oil & gas property, exploration, production, pipeline property.
  • 15 AAC 56.120  Intangible drilling expenses.
  • 15 AAC 56.130  Preservation of municipal powers.
Revised 7/1/13