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HB350

Alaska Qualified Entity Income Tax

Last scannedSep 23, 2026, 12:32 AM

In one sentence

This bill creates a new state income tax for specific business types that earn more than $25 million in a year.

What it does

  • Requires qualified entities with taxable income over $25,000,000 to pay a 9.4% tax on the amount above that limit.
  • Calculates taxable income as if these businesses were C corporations under federal rules from January 1, 2026.
  • Prevents taxpayers from using most federal tax credits or deductions against this new state tax liability.
  • Allows the Department of Revenue to combine the income of multiple related entities for tax calculation purposes.
  • Permits a deduction for payments made by these businesses to their owners if those owners also pay taxes under this chapter.

Who it affects

  • Sole proprietorships with taxable income over $25,000,000
  • Partnerships and limited liability companies (LLCs) meeting the income threshold
  • Entities that have elected to file federal returns under specific Internal Revenue Code sections

Limits and unknowns

  • The tax does not apply to corporations already taxed under AS 43.20.011 or their related unitary businesses.
  • This law only applies to tax years beginning on or after January 1, 2027.

Plain language

Terms to know

Qualified entity
A sole proprietorship, partnership, limited liability company, or an entity filing federal returns under certain tax code rules.
Unitary business
Multiple entities that are connected and treated as a single group for calculating taxable income.

Official record

Sources

Source checked
Official bill pageIntroduced textCurrent bill text
Read the official summary

QUALIFIED ENTITY INCOME TAX An Act establishing an income tax on certain entities in the state; and providing for an effective date.

Official activity

Bill history

  1. (H) REFERRED TO FINANCE2352
  2. (H) FN1: (REV)2352
  3. (H) NR: FRIER2352
  4. (H) DNP: COULOMBE, SADDLER2352
  5. (H) DP: CARRICK, HALL, FIELDS2352
  6. (H) L&C RPT CS(L&C) 3DP 2DNP 1NR2352
  7. (H) Moved CSHB 350(L&C) Out of Committee -- Delayed to 5 min. Following Session --Text
  8. (H) LABOR & COMMERCE at 03:15 PM BARNES 124Text
  9. (H) COSPONSOR(S): HALL2292
  10. (H) Heard & HeldText
  11. (H) LABOR & COMMERCE at 03:15 PM BARNES 124Text
  12. (H) Heard & HeldText
  13. (H) LABOR & COMMERCE at 03:15 PM BARNES 124Text
  14. (H) <Bill Hearing Canceled> -- Meeting Postponed from 3:15 pm 4/13/2026--Text
  15. (H) LABOR & COMMERCE at 08:00 AM BARNES 124Text
  16. (H) -- Public Testimony -- -- Meeting Postponed to 8:00 am 4/15/2026--Text
  17. (H) LABOR & COMMERCE at 03:15 PM BARNES 124Text
  18. (H) -- Public Testimony -- -- MEETING CANCELED --Text
  19. (H) LABOR & COMMERCE at 03:15 PM BARNES 124Text
  20. (H) Heard & HeldText