HB 365 - Summary

• Establishes a new individual income tax under AS 43.22, imposing tax on resident and nonresident individuals with Alaska-source income at 15 percent of federal income tax due plus a tax on long-term capital gains.

• Converts the Permanent Fund Dividend program into a refundable income tax credit, renaming it throughout statute from "dividend" to "refundable income tax credit" while maintaining similar eligibility requirements and claiming procedures.

• Implements a $1,200 annual cap on refundable income tax credits, with amounts exceeding this limit appropriated to the general fund.

• Reduces the Permanent Fund earnings transfer from 50 percent to 25 percent of available income, with the remaining 25 percent going to the general fund.

• Effective date: January 1, 2017, with prior dividend awards continuing under the old AS 43.23 rules.