Live in Vermont, Work Remotely for a Alaska Employer: Who Taxes You?
Answer
Your home state takes it and the work state does not. Alaska levies no tax on wages; Vermont taxes residents on all income regardless of where it was earned. The result is a single Vermont resident return covering the full amount, with no offsetting credit.
Last verified
Crossing into a state with no income tax does not lower your tax bill, because your home state is not taxing you on where you work — it is taxing you on where you live. Vermont reaches all of a resident's income, and Alaska adds nothing on top.
What you file
- 1Resident return · Vermont
File a Vermont resident return reporting all of your income.
The two states, side by side
| Vermont | Alaska | |
|---|---|---|
| Taxes wages | Yes — graduated | No |
| Reciprocity partners | None | None |
| Convenience rule | No | No |
| Nonresident return | Form IN-111 with Schedule IN-113 | Not applicable |
| Credit for other-state tax | Schedule IN-117 | No income tax |
| Nonresident safe harbour | None published | Not applicable |
| Local income tax | No | No |
| Revenue department | Vermont Department of Taxes | Alaska Department of Revenue — Tax Division |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Alaska and working in Vermont gives:No state income tax on your wages.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: Vermont → AlaskaHome state only
- 1099 contractor: Vermont → AlaskaHome state only — estimated payments
- Moved mid-year: Vermont → AlaskaOne part-year return — the state you left
Other Vermont pairs
Questions people actually ask
I live in Vermont and work remotely for a Alaska employer. Which state do I pay?
Your home state takes it and the work state does not. Alaska levies no tax on wages; Vermont taxes residents on all income regardless of where it was earned. The result is a single Vermont resident return covering the full amount, with no offsetting credit.
Which state should my employer be withholding for?
Vermont. Your employer should withhold Vermont tax rather than Alaska tax on these wages. If a Alaska line is showing on your pay stub, raise it with payroll now rather than at filing time.
How current is this?
The Vermont and Alaska rules on this page were last checked against Vermont Department of Taxes and Alaska Department of Revenue — Tax Division on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Vermont Department of Taxes — individual income taxaccessed 2026-08-07
- Alaska Department of Revenue — Tax Division — individual income taxaccessed 2026-08-07