00                            HOUSE BILL NO. 185                                                                          
01 "An Act establishing an income tax equal to the amount of the annual permanent fund                                     
02 dividend; relating to the duties of the Department of Revenue; and providing for an                                     
03 effective date."                                                                                                        
04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
05    * Section 1. The uncodified law of the State of Alaska is amended by adding a new section                          
06 to read:                                                                                                                
07       SHORT TITLE. This Act may be known as the Net Zero Income Tax Act.                                                
08    * Sec. 2. AS 43.23 is amended by adding new sections to read:                                                      
09                     Article 6A. Income Tax; Dividend.                                                                 
10            Sec. 43.23.280. Income tax. (a) A tax equal to the amount of the permanent                                 
11       fund dividend is imposed each year on each resident individual and nonresident                                    
12       individual who has income derived from or connected to the state.                                                 
13            (b)  An individual shall remit the tax due under this chapter by December 31 of                              
14       each year.                                                                                                        

01 (c)  An individual not filing a federal tax return jointly with another individual                                      
02 is exempt from the tax under this section if the individual's federal adjusted gross                                    
03 income for the taxable year is less than $75,000. Two individuals filing federal tax                                    
04 returns jointly are exempt from the tax under this section if the individuals' federal                                  
05 adjusted gross income for the taxable year is less than $150,000. An individual filing a                                
06 federal tax return as a dependent is exempt from the tax under this section. Income of                                  
07 a dependent may not be considered income of the individual claiming the person as a                                     
08       dependent.                                                                                                        
09 Sec. 43.23.290. Taxable income; general rule. In AS 43.23.280 - 43.23.310,                                            
10 taxable income is the taxpayer's federal adjusted gross income for the taxable year.                                    
11 The department shall adopt regulations adjusting gross income under this section as                                     
12       required by federal law.                                                                                          
13 Sec. 43.23.300. Returns and payment of taxes. (a) A taxpayer shall file with                                          
14       the department a return setting out                                                                               
15                 (1)  the amount of tax due under this chapter; and                                                      
16 (2)  other information necessary to carry out this chapter, as required by                                              
17       the department in regulation.                                                                                     
18 (b)  A person required to file a return under AS 43.23.280 - 43.23.310 shall file                                       
19 the return on a form or in a format prescribed by the department. The return is due to                                  
20 the department at the same time and in the same manner, including extensions, as the                                    
21 taxpayer's federal income tax return to the United States Internal Revenue Service. A                                   
22 return filed under AS 43.23.280 - 43.23.310 must be made under oath and on penalty                                      
23       of perjury.                                                                                                       
24 (c)  The total amount of tax imposed by AS 43.23.280 - 43.23.310 is due and                                             
25 payable to the department at the same time and in the same manner as the federal                                        
26       individual income tax payable to the United States Internal Revenue Service.                                      
27 Sec. 43.23.310. Permanent fund tax payment. The department shall adopt                                                
28 regulations establishing procedures for an individual eligible for a dividend under                                     
29 AS 43.23.005 to direct the department to hold all or a part of the amount of the                                        
30 dividend to pay the tax due under AS 43.23.280 - 43.23.310. The amount held under                                       
31 this section may not exceed the dividend amount after contributions, garnishments,                                      

01       levies, fees, attachments, assignments, or other reductions or donations allowed under                            
02       this chapter.                                                                                                     
03    * Sec. 2. This Act takes effect January 1, 2026.