Property Tax Exemptions in Alaska

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Property Tax Exemptions in Alaska

Introduction

Alaska has two kinds of property tax exemptions. These are exemptions that are required by law, and optional exemptions that a taxing authority may authorize. All municipalities must grant exemptions that are required or mandated in state law. Optional exemptions will vary depending on whether and what kind of additional exemptions the taxing authority has enacted. A review of the "Alaska Taxable"will show many of the optional exemptions, but it is a good idea to contact the local assessor's office(see "Directory of Tax Jurisdictions") for an up-to-date listing of those exemptions that may be available.

The StateAlaska Constitution, Article IX, Section 4, provides that, subject to conditions and exceptions provided by law, property of the state and its political subdivisions and property used for nonprofit, religious, charitable, cemetery, or educational purposes is exempt from taxation and provides that other exemptions may be granted by law. In addition to those listed above, AS 29.45.030 provides for additional mandatory exemptions, which are spelled out in statute.

AS 29.45.050 identifies some optional exemptions that, if the taxing authority chooses to adopt, must be enacted by ordinance and ratified through an election. This statute also identifies additional exemptions that may be enacted by ordinance without voter ratification.

Frequently Asked Questions

Are there tax exemptions available for residential property owners?

Yes, there are some mandatory exemptions and some optional exemptions. These exemptions, however, apply only to certain properties. Under AS 29.45.030(e), there is a mandatory exemption up to the first $150,000 of assessed value for the primary residence of a senior citizen, age 65 years and older, or a disabled veteran with a service connected disability of 50% or more. This exemption must be applied for by January 15 unless another date not later than March 31 is provided by ordinance on a form approved by the state assessor. (A municipality may waive timely filing for good cause.) All municipalities are required to grant this exemption.

AS 29.45.050 identifies an extensive list of optional exemptions a municipality may enact, including but not limited to, up to $10,000 of a primary residence and provides the option of applying the senior citizen/disabled veteran exemption in excess of the first $150,000 in the case of hardship. Contact the local assessors' office (see "Directory of Tax Jurisdictions" ) to find out what exemptions are available in the particular municipality. The local assessor's office should have application forms available to apply for exemptions.

Is there a tax exemption available for the disabled?

The only tax exemption available under state law for a disability is the disabled veteran tax exemption.

Is personal property taxable in Alaska?

Yes, personal property is taxable in Alaska; however, state law does allow municipalities to either partially or totally exempt all or different categories of personal property (AS 29.45.050(b)(2).) Check with the local assessor's office to find out if personal property is assessed and if there are any exemptions.

Is property of a "non-profit" organization exempt from property taxes?

Yes, in some cases, but there are certain limitations, which are clarified in the law. Property owned by a "non-profit" organization has to be used for specific purposes in order to be exempt, and the statutes are very clear on what those uses are. The uses are exclusively for (non-profit) charitable, religious, cemetery, hospital, or educational purposes (AS 29.45.030(a).)

Is city or state property still exempt from taxes if it is put to private use?

No, in most cases it is not. Article IX, Section 5 of the State Constitution and AS 29.45.030 state that these interests are taxable, with certain exceptions, and to "the extent of that interest." An example of taxable property would be a leasehold on public land.

Can a church have more than one church residence (parsonage) exempt from property taxes within the same municipality?

Yes. AS 29.45.030(b) lists the property used for religious purposes that is exempt from taxation. These exemptions were addressed by the Alaska Supreme Court, which has ruled that ".The wording of paragraph (b)(1) allows a single parish to contain more than one exempt residence." (City of Nome v. Catholic Bishop, 707 P2d. 870 (Alaska 1985).)

If an exempt property is used partly for a non-exempt purpose, does the property lose its entire exemption?

No. Only that portion that is used for a non-exempt purpose will be taxable. The remainder of the property that is used for an exempt purpose will stay exempt.

Narrative

In general, taxation is more common than exemptions. In order for property to be exempt from taxes, the law must specifically exempt it. All property owned by a non-profit is not necessarily exempt from taxes. Being owned by a non-profit organization is only one of the criteria that must be met. In Alaska, as with many other states, it is the use of the property that determines whether it is exempt. Contact the local assessor's office (see "Directory of Tax Jurisdictions") to find out whether a particular use of property is exempt.