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State Tax Withholding on IRA and 401(k) Withdrawals in Alaska (2026)

Updated October 7, 2026. Quick answer: No. The Department of Revenue’s Tax Division records that in 1980 the Legislature “repealed the parts of AS 43.20 that impose the individual income tax”, so Alaska has no individual income tax for a payer to withhold on an IRA or 401(k) withdrawal.

Alaska withholding at a glance

ItemWhat the documents say
Is it required?No. The Tax Division says the individual income tax provisions were repealed in 1980
Rate or amountNo rate: the report describes only a corporate income tax
How to start or stop itNothing to file: the report read describes no individual withholding in Alaska
Direct rolloverThe report read is silent on it; with no Alaska income tax described, there is no Alaska withholding to avoid
Changed for 2026?No change stated; the report read is the 2024 edition

What the Alaska documents say

The Tax Division’s 2024 annual report, in its corporate income tax history, records that in 1980 the Legislature “repealed the parts of AS 43.20 that impose the individual income tax”.

What the report describes today is a business tax: “Alaska levies a corporate income tax on Alaska taxable income”. That is a tax on corporations, not on a person’s retirement withdrawals.

A $50,000 withdrawal: cash in hand or a direct rollover

Take a $50,000 401(k) withdrawal paid to you. The IRS says a taxable eligible rollover distribution paid to you from an employer plan is subject to “mandatory income tax withholding (generally at a rate of 20%)”, which on $50,000 is $10,000 (computed as $50,000 times 20%) held back for federal tax. Alaska’s Tax Division reports only a corporate income tax, so nothing is held back for Alaska: the Alaska amount withheld is $0.

The other path is a direct rollover to an IRA or another plan. For federal tax the IRS says “The mandatory withholding doesn’t apply in a direct rollover”. A direct rollover therefore has no Alaska withholding to avoid.

What the documents do not say

  • The report does not mention withholding at all. That no state tax is withheld is the consequence of there being no individual income tax, not a line in the report. It also says nothing on rollovers or on any change for 2026.

Common mistakes

  • Reading the corporate income tax in the Tax Division report as a tax on a retirement withdrawal; it is a tax on corporations.
  • Expecting an Alaska form to stop withholding; the report read names none because there is no individual tax to stop.

Related: how Alaska taxes 401(k) and IRA withdrawals, Alaska retirement taxes, retirement withholding calculator, and retirement taxes by state.

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Sources

Sources: the primary documents linked above, read on October 7, 2026. General information, not tax advice. Your own facts decide the outcome, and a tax professional or the state agency itself is the right place to confirm anything consequential.

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