Alaska · LLC tax election
Alaska LLC: S corp or C corp?
With no personal income tax, Alaska's only real tax question is the corporate one.
See Alaska at a glanceShort answer
In Alaska an S election is the stronger choice for tax: the state has no individual income tax and exempts S corporations from corporate income tax. A C corp pays graduated rates up to 9.4%, unless it qualifies as a small corporation under the asset and industry tests.
Last checked .Alaska at a glance
| Question | Alaska |
|---|---|
| S election recognized? | Yes, Alaska follows the federal election1 |
| Separate state form and deadline | No separate state form2 |
| Tax the S corp itself pays | None at the entity level3 |
| C corp rate and minimum | 9.4% flat4 |
| Entity tax on a default LLC | None for a default LLC5 |
| Personal income tax | No tax on wages or pass-through income6 |
What is different about Alaska?
Alaska lets you ask a cleaner question than most states do. The Legislature repealed the individual income tax back in 1980, and the Department of Revenue says Alaska follows the federal rules that exempt S corporations from tax. So with an S election, neither the corporation nor you personally face an Alaska income tax on the profit. A C corporation does pay: graduated rates from 0% to 9.4% across ten brackets. There is a carve-out for certain small corporations with under $50 million in assets that meet industry tests. One catch is paperwork. Alaska exempts the S corp from tax, but not from filing.
Does Alaska recognize a federal S corp election?
Alaska recognizes the federal S election and exempts S corporations from its corporate income tax. The Department of Revenue says Alaska adopts the flow-through federal provisions, but not the requirement to file, so you still submit an Alaska return, due 30 days after the federal return is due. There is no separate Alaska S election form. Since Alaska has no individual income tax, shareholders owe nothing to the state on the pass-through income.
Does my LLC need a separate Alaska election or form?
The Department of Revenue describes no separate Alaska S election; Alaska follows the federal tax status and S corporations still file a return.2
What does Alaska tax an S corp or LLC at the entity level?
- Alaska exempts S corporations from its corporate income tax.3
- Alaska follows the federal tax treatment of limited liability companies, so a default LLC has no separate Alaska income tax.5
- Certain small C corporations are exempt: those with less than $50 million in assets that meet certain other asset and industry requirements.7
Is a Alaska LLC taxed as a C corp ever better?
An Alaska C corporation pays graduated corporate income tax at rates from 0% to 9.4% across ten brackets, according to the Department of Revenue's annual report. Certain small corporations are exempt, meaning those with less than $50 million in assets that meet other asset and industry requirements. Dividends you receive face no Alaska tax either, because the individual income tax is gone, but federal tax still applies.
Run your Alaska numbers
In Alaska the S election usually pays whenever your corporation would otherwise land in a taxed corporate bracket, because the S corp avoids Alaska corporate income tax and you owe no personal income tax. The costs are federal: payroll tax on a reasonable salary and the extra return. A small C corp that qualifies for the exemption may owe no Alaska tax either.
Result
How much would a Alaska LLC owner save as an S corp?
| Taxed as | At $80,000 profit | At $150,000 profit |
|---|---|---|
| Default LLC | $11,304self-employment tax $11,304 + Alaska LLC tax $0 | $21,194self-employment tax $21,194 + Alaska LLC tax $0 |
| S corp | $9,344payroll tax $7,344 + Alaska S corp tax $0 + $2,000 payroll and prep | $15,770payroll tax $13,770 + Alaska S corp tax $0 + $2,000 payroll and prep |
| C corp | $18,440payroll tax $7,344 + Alaska tax $3,008 + federal $6,088 + $2,000 payroll and prep | $32,826payroll tax $13,770 + Alaska tax $5,640 + federal $11,416 + $2,000 payroll and prep |
Assumes a 60% salary9 and a single filer. Income tax is left out. C corp dividends are taxed again.
When is the Form 2553 deadline for a Alaska LLC, and what if I miss it?
Late relief: federal steps, deadline guide.
What to do next
How to start one, or have us form it from $123.75.
Registered agent $74.25/yr, annual report.
LLC vs S corp guide, election deadline, Form 2553 filed for $165.
More on Alaska: How to start a Alaska LLC · How to start a Alaska corporation · Alaska LLC cost · Alaska annual report · Annual report late fees by state
File the S-Corp Election for your Alaska LLC
We file Form 2553 for a flat $165.
Get the S-Corp ElectionCommon questions
Does Alaska have a state income tax?
Not on individuals. The Legislature repealed the parts of AS 43.20 that impose the individual income tax in 1980. Alaska does tax C corporations at graduated rates up to 9.4%.
Does Alaska tax S corporations?
No. The Department of Revenue says Alaska adopts the flow-through federal provisions that exempt S corporations from tax. But S corporations still have to file an Alaska return.
What is the Alaska corporate income tax rate?
Graduated rates from 0% to 9.4% across ten brackets, per the Department of Revenue's annual report. The loaded report is the 2022 edition.
Are small corporations exempt from Alaska corporate income tax?
Some are. Corporations with less than $50 million in assets that meet certain other asset and industry requirements are exempt from the corporate income tax.
How does Alaska tax an LLC?
Alaska follows the federal tax treatment of limited liability companies. A default LLC is taxed as a disregarded entity or partnership and an LLC that elects corporate status is taxed that way.
Sources 10 links, checked Nov 6, 2026
- Alaska follows the federal rules that exempt S corporations from tax, but an S corporation must still file. tax.alaska.gov, checked Nov 6, 2026
- The Department of Revenue describes no separate Alaska S election; Alaska follows the federal tax status and S corporations still file a return. tax.alaska.gov, checked Nov 6, 2026
- Alaska exempts S corporations from its corporate income tax. tax.alaska.gov, checked Nov 6, 2026
- An Alaska C corporation pays graduated rates from 0% to 9.4% across ten brackets (2022 Department of Revenue annual report, the latest loaded). tax.alaska.gov, checked Nov 6, 2026
- Alaska follows the federal tax treatment of limited liability companies, so a default LLC has no separate Alaska income tax. tax.alaska.gov, checked Nov 6, 2026
- Alaska repealed its individual income tax in 1980. tax.alaska.gov, checked Nov 6, 2026
- Certain small C corporations are exempt: those with less than $50 million in assets that meet certain other asset and industry requirements. tax.alaska.gov, checked Nov 6, 2026
- IRS: Form 1120 instructions, C corp rate irs.gov, checked Nov 6, 2026
- IRS: S corp reasonable compensation irs.gov, checked Nov 6, 2026
- IRS: Form 2553 instructions irs.gov, checked Nov 6, 2026
Last verified Nov 6, 2026.
This page explains the rules; it is not tax advice. Run your numbers with a CPA or enrolled agent before you elect.
Last verified Nov 6, 2026.