State tax rates and rules for income, sales, property, estate, and other taxes that impact retirees. Go to Retiree Tax Map Alaska Add to State Compare List | View List View State Compare List (0) selected | Compare up to 5 The Bottom Line Tax-Friendly Although the Last Frontier has no state income or sales tax, it isn't necessarily a tax haven for all retirees. High property taxes have a lot to do with the state not making it into our list of the 10 most tax-friendly states for seniors. The state also has very high tax rates for beer and other alcoholic beverages. So don't cry in your beer when you get your property tax bill in the mail.There is, however, one unique perk if you live in Alaska — the state sends all permanent residents (who have lived there for at least one year) an annual dividend check from its oil wealth savings account. The 2021 payout was $1,114, which goes a long way in balancing out any bad tax news. Income Tax Range Alaska has no state income tax. Taxation of Social Security Benefits Social Security benefits are not taxed by the state. Tax Breaks for Other Retirement Income Alaska has no income tax. Sales Tax Alaska is one of five states with no state sales tax. However, localities can levy sales taxes, which can reach 7.5%. Higher rates are found in locations that lack a property tax. But, according to the Tax Foundation, the statewide average is only 1.76%. Real Property Taxes Homeowners 65 and older (or surviving spouses 60 and older) are exempt from municipal taxes on the first $150,000 of assessed value of their property. Annual Car Taxes and Fees An annual vehicle registration tax based on the car's class and model year may be imposed by a municipality. Estate and Inheritance Taxes No estate or inheritance tax.