Alaska employers must handle several payroll tax obligations: SUI contributions (1.00%–5.40% on the first $54,200 per employee), plus all federal payroll taxes (FICA at 7.65%, FUTA at 0.6% on the first $7,000). Alaska does not have a state income tax on wages. New employers are assigned a rate from DOLWD’s industry rate table, and employees contribute 0.50%.
Table of Contents
Overview: Alaska Payroll Tax Landscape
Running payroll in Alaska means managing federal tax obligations and state unemployment insurance. Here is the complete picture of what Alaska employers owe:
| Tax | Who Pays | Rate | Wage Base |
|---|---|---|---|
| Alaska SUI | Employer and employee | 1.00%–5.40% employer; 0.50% employee | $54,200 |
| Social Security (FICA) | Split 50/50 | 6.2% each | $184,500 |
| Medicare (FICA) | Split 50/50 | 1.45% each | No limit |
| FUTA | Employer | 0.6% (after credit) | $7,000 |
Alaska Has No State Income Tax
Alaska is one of the states that does not levy a state income tax on wages. This means you do not need to withhold state income tax from employee paychecks, and there is no state income tax return for employees to file.
However, this does not mean your payroll obligations are simple. You still must handle federal income tax withholding, FICA taxes, FUTA, and — critically — Alaska State Unemployment Insurance (SUI) contributions.
From the Payroll Desk
The biggest Alaska payroll surprise we see is sticker shock over the SUI wage base. At $54,200, employers pay unemployment tax on far more wages per employee than in most states. Budget as a result when hiring.
State Unemployment Insurance (SUI)
Alaska SUI applies to the first $54,200 of each employee's wages per year. New employers are assigned a rate from DOLWD’s industry rate table, and employees contribute 0.50%. Experienced employers are rated between 1.00%–5.40% based on their claims history.
SUI is administered by the Alaska Department of Labor and Workforce Development. You must register for an SUI account when you hire your first employee and file quarterly wage reports.
For a detailed breakdown, see our Alaska SUI Rates 2026 guide.
Federal Payroll Taxes
On top of Alaska state obligations, every employer must handle federal payroll taxes:
- FICA (Social Security + Medicare): 7.65% employer share, 7.65% employee share. Social Security applies to the first $184,500; Medicare has no cap.
- FUTA: 0.6% employer-only tax on the first $7,000 per employee (after state SUI credit).
- Federal Income Tax Withholding: Based on employee W-4 and IRS tables. Employer withholds but does not pay.
For a complete breakdown, see our Federal Payroll Tax Basics guide.
Filing Schedules and Deadlines
Key deadlines for Alaska employers:
- Federal 941: Quarterly — due by the last day of the month after each quarter
- Federal 940 (FUTA): Annual — due January 31
- Alaska SUI: Quarterly wage reports — due by the last day of the month after each quarter
- W-2s: Due to employees by January 31, filed with SSA by January 31
Penalties for Late Filing and Payment
Late or missed payroll tax payments result in penalties at both the federal and state level:
- IRS: Failure-to-deposit penalties range from 2% to 15% depending on how late
- Alaska: State penalties vary but typically include interest on unpaid balances plus fixed or percentage-based penalty fees
- Trust fund penalty: The IRS can hold business owners personally liable for unpaid withholding taxes (the "Trust Fund Recovery Penalty")
Frequently Asked Questions
What payroll taxes do Alaska employers pay?
Alaska employers pay federal payroll taxes (FICA, FUTA) and state unemployment insurance (SUI) on the first $54,200 of wages per employee. Alaska has no state income tax.
What is the Alaska SUI wage base for 2026?
The Alaska SUI wage base for 2026 is $54,200. Employers pay SUI on the first $54,200 of each employee's wages per year.
What is the new employer SUI rate in Alaska?
New employers in Alaska are assigned a rate from DOLWD's industry rate table, plus a 0.50% employee share. Experienced employer rates range from 1.00%–5.40% based on claims history.
When are Alaska payroll taxes due?
Alaska SUI taxes are typically filed quarterly. Federal payroll tax deposits follow the IRS monthly or semi-weekly schedule. Check with the Alaska Department of Revenue for current due dates.
Does Alaska have local payroll taxes?
Alaska does not have local income taxes.
Let Us Run Your Alaska Payroll
Alaska has no state income tax, so payroll comes down to federal filings and AK unemployment reporting. Pacific Data Services has run payroll for small businesses since 1969 and handles Alaska employers remotely, for one flat monthly price. Get a payroll quote.
Legal & Tax Disclaimer
This article is for general informational purposes only and does not constitute legal, tax, or professional advice. Employment laws, tax regulations, and compliance requirements change frequently. The information on this page reflects our understanding as of February 2026 and may not reflect recent changes in federal or Alaska state law.
Do not act or refrain from acting based solely on the information in this article. Always consult a qualified attorney, CPA, or HR professional familiar with Alaska law before making payroll or compliance decisions for your business.