Most Alaskans should have an additional $3,200 in their bank accounts by the end of September. Alaska will distribute dividends from the Permanent Fund on September 20 to citizens who have electronically submitted applications and selected direct deposit as their preferred method of payment.
PFDs, or Permanent Fund Dividends, are higher than usual this year in part due to the inclusion of a $650 energy assistance payment. Alaska is integrating its energy assistance into this year’s PFD dividend as opposed to making a separate payment, as other states have done.
Dividend for Alaska: 2022 Details
The PFD was $1,114 in 2021, and for a brief period of time, it appeared that Alaskans may get as much as $5,500 from the state in 2022. As a result of Russia and Ukraine, oil prices rose, and Alaska, a key oil-producing state, expected its earnings to soar. Additionally, given that it was an election year, some MPs reportedly felt compelled to fulfill their large dividend campaign pledges.
A budget with a $4,200 PFD and a $1,300 energy relief payment was approved by the Alaska Senate. However, the estimated $3.6 billion price tag was too much for the majority of House members to bear.
Instead, the $3.4 billion from the Permanent Fund that was divided between paying out dividends to citizens and the general fund was included in the final budget that was adopted by state legislators. Additionally, it increased the 2022 PFD by $650 to provide energy relief, bringing the total projected payment for individuals to $3,200.
“Alaskans have waited seven long years to receive a fair and sizable dividend, and it couldn’t have come at a more important time,” Gov. Mike Dunleavy made this statement in a press release.
Legislators now determine the annual payment amount, which Dunleavy described in his statement as a “arbitrary political procedure.” He asserted that adding a funding formula to the Alaska Constitution would be a better course of action.
Are Alaskans Receiving a PFD Early?
The dividend payment for 2022, often known as a “oil-wealth check,” is being given out a few weeks earlier than usual. PFDs are normally given out in early to mid-October, with the exception of 2020, when payments were advanced to July due to the Covid-19 pandemic.
Who Qualifies for an Alaska Oil-Wealth Check?
When a person applies for a PFD, dividends are issued to those who were Alaska residents for the entire year prior. Kids are included in this. Additionally, residents must want to stay in Alaska permanently. However, there are some exceptions, such as individuals who have received a felony sentence or are incarcerated.
A PFD is only available to individuals who apply for one, and the typical application window is from January 1 through March 31 every year. Only under specific conditions, such as if the applicant is disabled or a military member who was posted overseas to a hostile environment during the application period, are late applications approved.
How Are Alaskans Going to Get Paid?
Alaskans will either receive a check or a direct deposit for their PFD and energy assistance payment, depending on how they applied.
If you submitted your application electronically and asked for direct deposit, the distribution date is September 20. Paper checks will be mailed the week of October 3 if you submitted a paper application or asked for one.
Only applications that have been accepted by September 9 will be paid according to the aforementioned schedule, and residents can look into their myPFD accounts to see if they are eligible.
Are dividends from permanent funds taxed?
The federal government levies taxes on all resource rebates, including dividends from the Permanent Fund.
A 1099-MISC form is made available by the State of Alaska and can be used to report revenue to the federal government. You may view or print this form in your myPFD account. You can ask for help from the state’s Permanent Fund Dividend Division if you’re unable to access your account.
The Alaska Permanent Fund: What Is It?
In order to create the Permanent Fund and mandate that it receive at least 25% of the state’s oil and mineral royalties, Alaskan voters modified their state constitution in 1976. The revenues from the fund are used to bolster the state’s general fund and to distribute dividends to qualified citizens.
While the Permanent Fund Dividend Division of the state Department of Revenue distributes money to citizens, the Alaska Permanent Fund Corporation controls management of the fund. However, neither party is in charge of choosing the annual payment sum.
“While APFC’s 60 professionals invest the portfolio to protect the principal and maximize returns, the [Alaska] Legislature has the power of appropriation, including the appropriation of the fund’s earnings,” in an email to Forbes Advisor, an APFC representative stated.
The Future of PFD Payments in Alaska
When adjusted for inflation, the $3,200 payments rank second in history, but people shouldn’t assume that high Permanent Fund dividends will always occur.
Those who argued for greater rewards this year cited rising energy prices as their main justification. “Times are tough,” after the budget vote, Rep. Mike Prax (R-North Pole), according to news reports. “People are in a dire position, so if we can do anything to help them this year, I think that’s the appropriate thing to do.”
Alaskans may discover their dividends are lower in 2023 if both inflation and energy prices decline over the coming year.