Live in Colorado, Work in Alaska: Which State Taxes Your Paycheck?
Answer
Colorado taxes the income and Alaska cannot. Residency, not the location of the job, drives this answer: Colorado reaches all of a resident's income, and Alaska has no personal income tax to apply to the part earned inside its borders.
Last verified
The instinct that working in a no-tax state means paying no tax is the single most expensive misunderstanding in this niche. Alaska takes nothing, but Colorado still taxes residents on income earned anywhere, so the full amount lands on your Colorado return.
What you file
- 1Resident return · Colorado
File a Colorado resident return reporting all of your income.
The two states, side by side
| Colorado | Alaska | |
|---|---|---|
| Taxes wages | Yes — flat | No |
| Reciprocity partners | None | None |
| Convenience rule | No | No |
| Nonresident return | Form DR 0104 with Schedule DR 0104PN | Not applicable |
| Credit for other-state tax | Form DR 0104CR | No income tax |
| Nonresident safe harbour | None published | Not applicable |
| Local income tax | Yes | No |
| Revenue department | Colorado Department of Revenue — Taxation Division | 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 Colorado gives:Work state only.
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.
- Remote worker: Colorado → AlaskaHome state only
- 1099 contractor: Colorado → AlaskaHome state only — estimated payments
- Moved mid-year: Colorado → AlaskaOne part-year return — the state you left
Other Colorado pairs
Questions people actually ask
I live in Colorado and work in Alaska. Which state takes the tax out of my paycheck?
Colorado taxes the income and Alaska cannot. Residency, not the location of the job, drives this answer: Colorado reaches all of a resident's income, and Alaska has no personal income tax to apply to the part earned inside its borders.
Which state should my employer be withholding for?
Colorado. Your employer should withhold Colorado 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 Colorado and Alaska rules on this page were last checked against Colorado Department of Revenue — Taxation Division 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.
- Colorado Department of Revenue — Taxation Division — individual income taxaccessed 2026-08-07
- Alaska Department of Revenue — Tax Division — individual income taxaccessed 2026-08-07