Best Annuity Rates in Alaska (2026)

Alaska has no state income tax — making it one of only nine states where annuity withdrawals face zero state taxation. Anchorage, Fairbanks, Juneau, and the Kenai Peninsula attract retirees drawn to Alaska’s natural beauty and, increasingly, its financial advantages: no income tax, no estate tax, and the annual Alaska Permanent Fund Dividend that puts money back into residents’ pockets every year. Before comparing rates, see how annuities work and which type fits your retirement income plan.

Below are today’s best MYGA rates available to Alaska residents, filtered to A-rated carriers only, updated daily.

Are Fixed Annuities a Good Investment in Alaska?

With no state income tax, Alaska’s annuity math is simple: your after-tax MYGA return is your contract rate minus your federal income tax bracket — nothing else. A 5.00% MYGA for a federal taxpayer in the 22% bracket yields approximately 3.90% after-tax — and that is the complete picture. No Alaska deduction to calculate, no state bracket to manage.

Here is a concrete example: John, age 65, lives in Anchorage with $225,000 to invest. He puts it into a 5-year MYGA at 5.00%. His account grows to approximately $287,376 at maturity — a $62,376 gain. Alaska collects zero income tax when he withdraws that gain. Only federal income tax applies. In a high-tax state like California, the same withdrawal would trigger an additional 9.3%–13.3% state tax on those gains. Alaska keeps all of that in John’s pocket.

Alaska also pays residents an annual dividend from the Alaska Permanent Fund — a payment that has ranged from roughly $900 to over $3,000 per year depending on oil revenues and legislative decisions. The dividend is subject to federal income tax but not Alaska state tax. For retirees, it provides additional income that partially offsets Alaska’s higher cost of living in remote areas.

Alaska Guaranty Association: How Your Annuity Is Protected

The Alaska Life and Health Insurance Guaranty Association (ALHIGA) protects Alaska policyholders if a licensed insurer becomes insolvent. Coverage is automatic — no enrollment required.

For annuity portfolios over $250,000, split across two or more A-rated carriers to keep each position within coverage limits.

Alaska Life and Health Insurance Guaranty Association
Website: alaskalifega.org

How Alaska Taxes Annuity Income

Alaska has no personal income tax. Annuity withdrawals of any type — MYGA, fixed, income, or variable — face zero Alaska state taxation. Only federal income tax applies. There is no Alaska state tax on Social Security benefits, pension income, IRA distributions, or any other form of retirement income.

Alaska has no state estate tax and no inheritance tax. Annuity death benefits pass to named beneficiaries entirely free of Alaska-level taxation.

Alaska Division of Insurance

The Alaska Division of Insurance (DOI) — part of the Department of Commerce, Community, and Economic Development — licenses and regulates all insurance carriers and agents operating in Alaska. Verify both the carrier and your agent before purchasing an annuity.

Tips for Buying an Annuity in Alaska

• Zero state tax makes calculation easy: Your net annuity return equals your contract rate minus your federal bracket. A 5.10% MYGA for a taxpayer in the 22% federal bracket yields approximately 3.98% after-tax — no Alaska calculation needed.
• Factor in the Permanent Fund Dividend: Alaska pays an annual dividend to residents from the Permanent Fund. It is subject to federal income tax and can push you into a slightly higher federal bracket in dividend years. Some annuity buyers time larger withdrawals in non-dividend years to manage federal bracket exposure.
• Higher cost of living is part of the math: Alaska’s cost of living — especially outside Anchorage — is meaningfully higher than the contiguous U.S. The tax savings on retirement income are real, but factor total cost of living into any relocation decision.
• No estate tax means clean wealth transfer: No Alaska estate or inheritance tax. Name beneficiaries on annuity contracts to pass death benefits free of any Alaska-level taxation and bypass probate.
• Don’t exceed $250,000 per carrier: For portfolios over $250,000, use two or more A-rated carriers to stay within guaranty protection limits.
• Use the free-look period: Alaska requires at least 10 days to review and cancel any annuity contract for a full premium refund.