Hello there! Ready to tackle your taxes like a pro? If you're an Alaska resident, you've likely received your Permanent Fund Dividend (PFD), and now it's time to make sure you report it correctly on your federal tax return using TurboTax. Don't worry, it's a straightforward process once you know the steps. Let's dive in!
How to Enter Your Alaska Permanent Fund Dividend (PFD) on TurboTax: A Comprehensive Guide
The Alaska Permanent Fund Dividend (PFD) is a unique benefit for eligible residents of Alaska, an annual payment derived from the state's oil revenues. While Alaska itself doesn't have a state income tax, the PFD is considered taxable income by the IRS and must be reported on your federal tax return. Failing to do so can lead to penalties, so it's crucial to get it right. This guide will walk you through the process of entering your PFD in TurboTax, ensuring you're compliant and accurately reporting your income.
Step 1: Gather Your Documents and Open TurboTax
Before you even log into TurboTax, make sure you have everything you need. This will make the entire process smoother and prevent frustrating stops and starts.
Sub-heading: What You'll Need
Your Alaska PFD Information: While you typically don't receive a traditional 1099-DIV for your PFD, the IRS considers it "other income." You'll need the exact amount of your PFD.
Your TurboTax Account: Make sure you have your login credentials ready.
Any Other Tax Documents: W-2s, 1099s (for other income like interest or dividends), etc., as you'll be working on your full tax return.
Sub-heading: Starting Your TurboTax Return
Launch TurboTax: Open your TurboTax software or navigate to the TurboTax website (if you're using the online version).
Sign In or Continue Your Return: Log in to your account. If you've already started your tax return, click "Continue your return." If you're starting fresh, follow the prompts to begin a new return.
Step 2: Navigate to the Income Section
The Alaska PFD is reported under the "Other Income" section in TurboTax, even though it's a dividend by name. TurboTax handles it specifically within the 1099-MISC or "Less Common Income" area.
Sub-heading: Finding the Right Spot in TurboTax Online
Search for "Alaska Fund": In the TurboTax search bar (usually at the top right), type "Alaska fund" and press Enter.
Select "Jump to link": A "Jump to" link should appear in the search results. Click on this link. This will take you directly to the relevant section for entering your PFD.
Sub-heading: Alternative Navigation (if "Jump to" isn't working or for desktop software)
Federal Taxes (or Federal): Click on "Federal" or "Federal Taxes" from the main navigation menu.
Wages & Income (or Income & Expenses): Select "Wages & Income" or "Income & Expenses."
Less Common Income: Scroll down until you see a section labeled "Less Common Income" or similar.
Miscellaneous Income (or Other Common Income): Look for "Miscellaneous Income, 1099-A, 1099-C" or "Other Common Income." You might need to click "Start" or "Revisit" next to it.
Other Income: Within this section, you'll often find an option for "Other income not already reported on a W-2 or 1099." This is where the PFD typically gets entered.
Step 3: Enter Your PFD Details
This is where you'll provide the specifics of your Alaska Permanent Fund Dividend.
Sub-heading: Providing the 1099-MISC Information (Even if You Don't Have One)
TurboTax often prompts you with "Did you get a 1099-MISC?". Even if you didn't receive a physical 1099-MISC for your PFD, you should answer "Yes" to this question. This is a common workaround in TurboTax to correctly categorize the PFD.
Who Paid You?: Enter "Permanent Fund Dividend Division."
Payer's Federal ID Number: Enter "92-6001185." This is the official Federal ID Number for the Alaska Permanent Fund Division.
Box 3 Amount: In the box corresponding to "Box 3: Other Income," enter the full amount of your Alaska Permanent Fund Dividend.
Sub-heading: Specifying it's a PFD
Description of Income: On the next screen, you'll be asked for the reason or description of this income. Enter "Alaska Permanent Fund Dividend."
Uncommon Situations: TurboTax might then present a screen asking about "uncommon situations." Carefully look for and select the option that states "This was an Alaska Permanent Fund dividend distribution." This crucial step ensures the PFD is properly categorized and reported on Schedule 1, Line 8g of your Form 1040.
Continue: Click "Continue" to proceed.
Sub-heading: Handling Joint Filers
If you are filing jointly and your spouse also received an Alaska PFD, TurboTax will likely ask if you need to enter another PFD. Select "Yes" and repeat the steps for your spouse's dividend.
Step 4: Review and Verify
Once you've entered your PFD, it's vital to review your tax return to ensure it's been correctly applied.
Sub-heading: Checking Your Forms
Form 1040, Schedule 1: Your Alaska PFD should be reported on Form 1040, Schedule 1, Line 8g. Take a moment to verify this in your TurboTax summary or by reviewing the actual forms generated by the software.
Impact on Your Tax Liability: Understand that the PFD amount will be added to your total taxable income, which may increase your federal tax liability. Alaska does not tax the PFD, but the IRS does.
Sub-heading: What to Do if You See Issues
If you notice any discrepancies or if the PFD isn't appearing as expected, revisit the "Less Common Income" or "1099-MISC" section in TurboTax and re-enter the information carefully, ensuring you select the specific "Alaska Permanent Fund dividend distribution" option.
If you're still having trouble, consider using TurboTax's "Search" function with keywords like "Alaska PFD" or "Permanent Fund Dividend" to find specific help articles or jump links within the program.
Step 5: Finalize Your Return
After accurately entering your Alaska PFD and all other income and deductions, you can proceed with the rest of your tax filing process.
Sub-heading: Completing Your Return
State Taxes (if applicable): Since Alaska does not have a state income tax, you won't need to report your PFD on an Alaska state tax return. However, if you have residency in another state that does have an income tax, you'll need to address that separately.
Review and File: Go through the final review steps in TurboTax. It's always a good idea to double-check all your entries before electronically filing your return or printing it for mailing.
Payment or Refund: Based on your income, deductions, and credits, TurboTax will calculate whether you owe taxes or are due a refund.
Frequently Asked Questions (FAQs) about Alaska PFD and TurboTax
Here are 10 common questions related to reporting your Alaska PFD on TurboTax:
How to know if my Alaska PFD is taxable?
Yes, the Alaska Permanent Fund Dividend (PFD) is fully taxable for federal income tax purposes by the IRS, even though the State of Alaska does not tax it.
How to find the Payer's Federal ID Number for the Alaska PFD?
The Payer's Federal ID Number for the Alaska Permanent Fund Dividend is 92-6001185.
How to report a child's Alaska PFD on my TurboTax return?
If your child's only unearned income (including the PFD) is below a certain threshold (e.g., $13,000 for 2024, but this amount can change annually, so check current IRS guidelines), you can elect to report their PFD on your return using Form 8814 or they can file their own return. TurboTax should guide you through this option within the "Child's Income" section under "Less Common Income."
How to handle the PFD if I didn't receive a 1099-MISC?
Even if you don't receive a physical 1099-MISC, you still report the PFD as if you did, typically in the 1099-MISC section within TurboTax, by answering "Yes" to the 1099-MISC question and manually entering the details.
How to ensure the PFD is correctly reported on Schedule 1, Line 8g?
When entering the PFD in TurboTax, make sure to select the option that specifically identifies it as an "Alaska Permanent Fund dividend distribution." This tells TurboTax to properly categorize it on Schedule 1, Line 8g of your Form 1040.
How to amend my tax return if I forgot to report my Alaska PFD?
If you forgot to report your PFD, you will need to amend your tax return using Form 1040-X, Amended U.S. Individual Income Tax Return. TurboTax usually has a feature to help you amend a previously filed return.
How to find the correct amount of my Alaska PFD?
The Alaska Department of Revenue, Permanent Fund Dividend Division, typically announces the official PFD amount each year. You can also refer to your records or the PFD website for the exact amount you received.
How to account for the PFD if part of it was an "energy relief" payment in previous years?
In some past years, a portion of the PFD was designated as an "energy relief" payment. Historically, some of these "energy relief" portions were deemed non-taxable by the IRS. However, for recent years (e.g., 2024 PFD received in 2025), the entire PFD is generally taxable. Always refer to the most current IRS guidance and TurboTax prompts.
How to avoid penalties for not reporting the Alaska PFD?
The simplest way to avoid penalties is to accurately report the entire PFD amount as taxable income on your federal tax return in the year it was received. If you are unsure, consult a tax professional.
How to get help within TurboTax if I'm stuck?
TurboTax offers a search bar where you can type questions or keywords (e.g., "Alaska PFD," "1099-MISC"). They also have an extensive help section, community forums, and options for live tax expert assistance depending on your TurboTax product.
