Property tax relief in Alaska: the $150,000 senior and disabled veteran exemption

An Alaskan who turns 65 and applies to the local assessor by its deadline stops paying property tax on the first $150,000 of the home’s assessed value, for as long as the home is the primary residence. The exemption is in state law, AS 29.45.030(e), and every municipality that levies a property tax must grant it; the municipality sets the deadline and takes the application, which is a one-time filing that renews each year unless something changes. In Anchorage, at the mill rate the municipality uses in its own example, 16.145, the exemption is worth $2,422 a year. The same exemption goes to a veteran with a service-connected disability rated 50% or more, at any age, and to the widow or widower, 60 or older, of someone who had it. Nothing is applied for with the state; the assessor’s office of the borough or city is the only place to go.

Before any of that, a prior question: is there a property tax where you live? Alaska has 165 municipalities, and the Office of the State Assessor counts 24 that levy a property tax, 15 of the 19 boroughs and 9 cities outside any borough (verify the current count). Most of the state’s land area, including the unorganized borough, has no property tax, and a homeowner there has nothing to apply for. Anchorage, the Fairbanks North Star, Mat-Su and Kenai Peninsula boroughs, Juneau and Ketchikan all tax property; many smaller places do not.

Who qualifies

The exemption comes off assessed value, so its value in dollars is $150,000 times the mill rate where you live. A home assessed below $150,000 is fully exempt.

Only one owner has to qualify. A married couple gets the exemption when the older spouse reaches 65, and keeps it if that spouse dies, provided the survivor is at least 60. The home may be held in a revocable trust; the assessor will want the pages of the trust that name the applicant as trustee or beneficiary and identify the property. A home held by an LLC or in a child’s name does not qualify.

How to apply, and when

The application goes to the assessor of the borough or city that sends the bill, by that municipality’s deadline. Two of the largest:

Anchorage. The senior citizen and the disabled veteran applications must be complete and received or postmarked by March 15. For 2027 the senior applicant must have turned 65 by December 31, 2026 and, for a first application, have been an Alaska resident for all of 2026. The home must have been owned and occupied as the primary residence before January 1, 2027. Proof of age is an Alaska driver’s license or state ID, birth certificate, passport or DD 214; a veteran also provides a VA benefits summary letter dated within the past year showing the rating and the discharge date. Filing the senior or veteran application automatically files Anchorage’s residential exemption application as well. A veteran whose final rating arrives after March 15 may file within 30 days of receiving it.

Mat-Su Borough. Timely applications are accepted through April 30. The applicant must have been an Alaska resident for the entire year before the exemption year and have owned and occupied the home as a permanent home before January 1. The borough asks for its Senior Citizen/Disabled Veteran Exemption Form and a Supplemental Residency and Occupancy Qualification Form together, with proof of age the first time and the VA rating letter for a veteran.

Elsewhere, the assessor’s office publishes its own form and date, and state law allows a municipality to waive a late filing for good cause; whether it does is the municipality’s choice, not the applicant’s right. Once granted, the exemption continues each year without a new application. Both Anchorage and Mat-Su require the owner to report any change in ownership, use, residency, disability status or anything else that bears on eligibility, and both put the burden of proof on the owner.

The occupancy rule

After the first year, Anchorage and Mat-Su both require that the home be owned and occupied as the primary residence and permanent place of abode for at least 185 days before January 1 of the tax year, and that it not be rented or leased to anyone else while the owner is away. An owner who moves to assisted living and leaves the house empty may keep the exemption under local rules; an owner who rents it out loses it. A senior who spends more than half the year outside Alaska loses it too, and will have lost the Permanent Fund Dividend first, since the dividend allows only 180 days of absence; the two rules are written to the same calendar. An owner may not hold the exemption on one property while another property of theirs receives a residential, senior or disabled veteran exemption anywhere.

What the boroughs add

State law, AS 29.45.050, lets a municipality adopt optional exemptions by ordinance or by vote, including a residential exemption for owner-occupants generally and a senior and disabled veteran exemption above the mandatory $150,000. Two large boroughs have.

Mat-Su exempts up to $135,279 more of assessed value for the same seniors, disabled veterans and surviving spouses under its optional program, for a combined $285,279 off the assessed value of a qualifying home. The optional figure is adjusted from time to time; $135,279 is the amount on the borough’s page as of this writing (verify; a second 2026 borough document shows $129,720).

Anchorage grants every owner-occupant, at any age, a residential exemption of 40% of assessed value up to a maximum of $75,000, under Anchorage Municipal Code 12.15.015, on the same March 15 deadline and the same residency and 185-day occupancy rules. The senior and veteran forms double as the residential application, which suggests the two are meant to be claimed together; how the two combine on one bill is a question for the Anchorage assessor (verify).

Other boroughs and cities have their own optional exemptions, or none. The Kenai Peninsula Borough has a grandfathered disability exemption; the assessor’s office in each place is the authority on what it offers.

The federal side

The exemption is not income and appears nowhere on Form 1040. Its only federal effect is that the property tax actually paid is smaller, which lowers the state-and-local tax deduction on Schedule A for a household that itemizes. Few Alaska seniors itemize: with no state income tax, the SALT line is property tax plus local sales tax, if any, and a couple over 65 would need those plus mortgage interest and charitable gifts to exceed a standard deduction of $32,200, plus $1,650 each for age, plus the $6,000-each senior deduction, about $47,500 in all for 2026. Property tax paid through a mortgage escrow is deductible in the year the servicer pays it, which the Form 1098 or the year-end escrow statement shows.