Alaska Senior Citizen and Disabled Veteran Property Tax Exemption

Quick Facts

• What it does: Exempts the first $150,000 of assessed value from municipal property taxes for qualifying seniors (65+) and disabled veterans (50% or more service-connected disability). Some municipalities extend the exemption beyond the state minimum.
• Who qualifies: Alaska residents who own and occupy their primary residence as of January 1 and meet age or disability criteria. Surviving spouses age 60+ of eligible individuals may continue receiving the exemption.
• How to apply: File the local application—commonly Form 54 or municipal equivalent—with the city or borough assessor by March 31. Provide proof of age, disability status, and residency.
• Documentation: Alaska driver’s license, voter registration, permanent fund dividend eligibility, DD-214, VA disability letter, or SSA benefit statements.
• Renewal: Once approved, most municipalities require an annual residency affidavit. If you move or rent the home, notify the assessor to avoid penalties.

Program Overview

Alaska’s constitution allows municipalities to levy property taxes, but the state legislature recognized that elders and disabled veterans on fixed incomes needed protection from rising costs. The Senior Citizen and Disabled Veteran Property Tax Exemption is codified in AS 29.45.030(e). It mandates that every municipality exempt the first $150,000 of assessed value for qualified applicants, with local governments allowed to raise the exemption or offer additional relief.

Because Alaska lacks a statewide income tax, property taxes can be a major revenue source, especially in urban areas like Anchorage, Juneau, and Fairbanks. Without the exemption, seniors could face unsustainable bills due to increasing property values. The exemption reduces the taxable assessed value, which in turn reduces the tax owed. For example, if your home is assessed at $250,000 and your mill rate is 12, exempting $150,000 saves $1,800 annually.

Eligibility Requirements

Age and Disability Criteria

• Senior citizens: You must be 65 or older on January 1 of the assessment year. The exemption applies to the entire property even if co-owners are younger.
• Disabled veterans: You qualify if you are an Alaska resident and:
  • Have a service-connected disability rating of 50% or more from the U.S. Department of Veterans Affairs; or
  • Receive disability compensation at the 100% rate due to individual unemployability.
• Surviving spouses: Individuals age 60 or older whose spouse qualified at death may continue the exemption if they remain in the home.

Residency and Ownership

• You must own and occupy the property as your primary residence and permanent place of abode. Owning through a trust or life estate qualifies if you have the right to occupy the home.
• Residency is demonstrated through evidence such as Alaska Permanent Fund Dividend (PFD) eligibility, voter registration, vehicle registration, and Alaska driver’s license.
• Temporary absences (medical treatment, vacation) are allowed if the home remains your principal residence and is not rented long-term. Extended rentals can disqualify you for that year.

Property Type

• Eligible properties include single-family homes, duplexes where you occupy one unit, condominiums, and mobile homes on owned land. Floating homes and recreational properties are typically excluded.
• Co-op members should provide the proprietary lease and documentation showing their share of property tax liability.

Application Process

1. Obtain municipal forms: Each municipality has its own application. Download from the local assessor’s website (e.g., Municipality of Anchorage Form 54) or request by mail.
2. Gather proof of eligibility: Seniors submit proof of age; veterans provide VA disability letters or military records. Surviving spouses include the deceased spouse’s documentation and proof of age.
3. Document residency: Provide copies of your Alaska driver’s license, PFD eligibility confirmation, voter registration card, or utility bills showing occupancy as of January 1.
4. Complete the application: Include parcel number, property address, ownership details, and signatures. If the property is in a trust, attach the trust instrument showing your occupancy rights.
5. Submit by March 31: Deliver to the assessor’s office or mail with sufficient time to arrive by the deadline. Some municipalities accept email submissions with scanned signatures.
6. Await confirmation: Assessors review applications in spring and send approval letters or follow-up requests. Check your tax bill to ensure the exemption is applied.

Renewal Requirements

• Most municipalities require an annual statement of residency or postcard confirmation. Respond promptly to maintain the exemption.
• If you move, rent out the home, or pass away, notify the assessor within 30 days. Unreported changes can result in back taxes and penalties.
• If you lose the exemption for a year (e.g., due to relocation), you can reapply when you meet the criteria again.

Coordination with Local Options

• Municipalities can increase the exemption beyond $150,000 or offer supplemental relief. For example, the Kenai Peninsula Borough extends additional exemptions, and some boroughs offer senior hardship deferments.
• Combine the exemption with optional senior citizen sales tax exemptions or utility discounts offered by municipalities and service districts.
• Veterans may stack the property tax exemption with federal VA Specially Adapted Housing grants or state home loan programs for further financial assistance.

Planning Tips

1. Apply promptly when turning 65: File in the year you reach age 65 to lock in savings early. Your base-year assessment may become the foundation for other local relief.
2. Maintain Alaska residency evidence: Keep documentation up to date. Participation in the PFD program is a strong indicator of residency—ensure you meet PFD residency rules as well.
3. Review assessments: Even with the exemption, verify your assessed value is accurate. File appeals if the value of the taxable portion seems inflated.
4. Coordinate with estate planning: Since the exemption ends when property ownership changes, discuss continuation strategies with heirs. Surviving spouses should reapply promptly upon the qualifying spouse’s death.
5. Monitor rental use: Short-term rentals may be permitted in some jurisdictions, but long-term rentals typically disqualify you. Consult your assessor before renting rooms or the entire home.

Common Mistakes

• Missing the March 31 deadline: Late applications are not accepted. Set reminders and submit early.
• Insufficient proof of disability: Veterans must provide current VA disability documentation. Letters indicating “pending” status are not enough.
• Trust documentation gaps: If the property is in a trust, include the pages showing the trust name, trustees, and occupancy rights. Missing pages can cause delays.
• Residency misunderstandings: Spending significant time outside Alaska may trigger residency questions. Keep travel records and maintain Alaska ties.
• Not updating after relocation: If you permanently move, inform the assessor. Failure to do so can lead to retroactive tax bills with interest.

Frequently Asked Questions

Can two seniors in the same household both claim the exemption? The exemption applies once per property, regardless of the number of qualifying residents. However, if you own two separate homes, each must be occupied by a qualifying individual to receive exemptions.

How does the exemption affect my mortgage escrow? Notify your lender once the exemption is approved. Lower property taxes may reduce escrow requirements, leading to lower monthly payments or escrow refunds.

Are there income limits? No. Eligibility is based on age or disability and residency, not income. High-income seniors can still benefit.

Does the exemption apply to special assessments? It applies to municipal property taxes, not necessarily to special assessments for utilities or service areas. Review your tax bill to see which charges remain.

What if my assessed value is below $150,000? The exemption eliminates your municipal property tax. You may still owe service area fees or other charges.

Additional Resources

• Alaska Tax Division Property Tax Exemption Page
• Municipality of Anchorage Assessor: (907) 343-6770 for Form 54 and assistance.
• Fairbanks North Star Borough Assessing Department: (907) 459-1429.
• Alaska Office of Veterans Affairs: (907) 334-0874 for help obtaining VA disability documentation.
• Alaska Legal Services Corporation: Provides free legal help to eligible seniors navigating property tax and housing issues.

The Alaska Senior Citizen and Disabled Veteran Property Tax Exemption delivers substantial savings, often eliminating property taxes entirely for eligible households. By applying on time, maintaining residency, and coordinating with local programs, you can preserve your financial stability and remain in your home for years to come.