Alaska Mining License Tax Return (Short Form) Instructions

Mining License Tax Return (Short Form) Instructions
Form 662SFi
Instructions for Form 662SF
Alaska Mining License Tax Return
What’s New
Taxpayers Are Required to File Electronically

Taxpayers are required to file electronically all tax returns and reports, unless a taxpayer applies for and is granted a waiver from
that requirement, according to Alaska Statutes 43.05.045.
The Alaska Department of Revenue’s Tax Division has electronic
filing through Revenue Online, an online portal where taxpayers
can file and pay tax returns, view tax accounts and balances, apply for licenses, upload documents, and conduct other business
with the Tax Division.
Revenue Online allows the Tax Division to process refunds faster,
communicate with taxpayers quicker, and to more efficiently account for information it’s required to report to the Alaska Legislature.
See page 2 for more information on the waiver and potential
penalty.

General Information
Mining License Tax Return – Form 662SF

This form can only be used by a cash-basis taxpayer with one
mining operation and no other related business activities. A
taxpayer who has expenses that are incurred to support multiple
business and/or mining activities must use the Mining License
Tax Return Long Form (Form 662).
Only one short form can be filed by a taxpayer for a tax year.
Mining license applications are due each year and are filed separately from the mining license tax return. Please use Form 661 to
apply for a mining license.
Use this form to calculate the Alaska mining license tax on a
mining operation that conducted mining during the tax year
in Alaska, including operating and royalty interests. A mining
operation is an operation by which valuable metals, ores,
minerals, asbestos, gypsum, coal or stone, are extracted, mined
or taken from the earth. A mining operation consists of a single
mining property or several mining properties that are connected
geographically.

Note: Mining license applications are due each year and are filed
separate from the mining license tax return. Please use Form 661
to apply for a mining license.

Return Due Date

A taxpayer shall file the return either on a calendar-year or fiscalyear basis, in conformance with the basis used in making the
return for federal income tax purposes. An entity with a calendar
year-end shall file a return on or before April 30 of the following
calendar year. An entity with a fiscal year-end shall file a return
on or before the last day of the fourth month following the end of
the fiscal year.

Extension of Time to File

Upon application, the Tax Division will, at its discretion, grant
an extension of time to file a mining license tax return. The
Application for Extension of Time to File (Form 668) can be found
on the Tax Division’s website at www.tax.alaska.gov.
An application for an extension of time for filing a return must be
filed with the Tax Division no later than the date the return is due,
and must include a complete statement of the reasons for the
request for an extension.
An extension of time for filing the return does not extend the time
for payment of the total amount of tax due.

Form Changes

Page 1 – The mining license number is required on Page 1. The
first return and final return checkboxes have been deleted, along
with the “Electronic Payment Information” section.

Avoid Common Mistakes
To facilitate the processing of your return, be sure to do the
following:
1.

Use the correct form. If you have more than one mining license, you must use Form 662.

2.

File with the correct taxpayer name. If you are filing as
an individual, you must use the name reported on your
1040 federal return. If you are filing as a company,
use the same name as it appeared on the prior mining
license tax return. If the company name has changed,
please call us.

3.

Provide the correct federal employer identification
number (FEIN) or Social Security number (SSN).

4

Fill in the Month/Day and Year to indicate for which tax
period you are filing. Example: 12/31, plus prior year,
if you are a calendar year filer.

5.

Provide the name and phone number of a contact
person who is authorized to answer any questions
the Tax Division may have regarding the return. The
contact person must be an officer or employee who
is authorized to answer any such questions. The Tax
Division cannot discuss taxpayer information with an
outside party unless we have received a Power of
Attorney.

Who must file a mining license tax return?

A person engaged in one or more of the following activities in
the state is in the business of mining and shall obtain a mining
license and file a mining license tax return:
1.	 A person owning and/or operating a mining property.
2.	 A person owning a mining property and receiving lease
payments or royalty payments based on production
from the property.
3.	 A person leasing a mining property.
4.	 A person possessing a mineral interest, whether
an economic or production interest, in a producing
property, including royalty, working or operating
interests, net profits, overriding royalties, carried
interests and production payments.

0405-662SFi 10-13-22 - Page 1

6.

Only use U.S. dollars when reporting income and
expenses. This includes, but is not limited to, royalties paid and royalties received. Do not use ounces
or any other unit of measure unless the line item
indicates units are to be used.

7.

If you have multiple licenses, use Form 662 and file a
separate schedule for each license. Do not use
the same mining license number on more than one
schedule.

8.

Attach schedules as required by the forms. Schedules
providing detail are required as explained in the instructions. Attaching complete schedules will ensure a
valid filing and prevent unnecessary correspondence
with the Tax Division. Be sure that attached schedules are properly referenced and agree to the totals
reported on the form.

9.

Sign the return. The return is not valid until it has
been signed. The return must be signed and dated by
a person legally authorized to do so.

How and Where to File and Pay
Filing Your Return

As mentioned earlier, a taxpayer is required to electronically file
all returns and reports electronically using Revenue Online at
www.tax.alaska.gov, unless the Tax Division grants a waiver
from the requirement. The requirement became effective July 1,
2016.

Pay Electronically

Revenue Online uses Automated Clearing House (ACH)
debit payments. It does not accept credit cards or ACH credit
transactions.
If you are making a payment using Revenue Online for the
first time, click on “Enroll Now” on the sign-in page and follow
the prompts. If you have questions, call the Tax Division at
907.269.0041 or 907.269.6627.
Check with your bank before setting up a debit (ACH) payment
to determine if your account has a debit block. Debit blocks (or
filters) control electronic transactions posted to bank accounts
and only accept transactions from authorized ACH debit
originators.
If you have a debit block on your account, you must ask your bank
to list the State of Alaska as an authorized ACH debit originator on
your account, and give your bank the Department of Revenue’s
company ID (0000902050). If you don’t give that information to
your bank, your bank will reject your tax payment, and rejected
payments may result in late payment penalties and interest.

Pay by Wire Transfer

To make a payment by wire transfer, you must notify the
Department of Revenue, Treasury Division by 2:00PM Alaska
Time the business day prior to the wire transfer settlement
date.

Failure to file electronically may result in a penalty. The penalty
is (the greater of) $25 or 1% of the total tax due before payments
are applied. (See AS 43.05.045 and As 43.05.220(f).)

For the notification, prepare a payment voucher on Revenue
Online, and email it to [email protected]. The
notice must include the taxpayer’s name, total payment amount,
settlement date, tax type, purpose of the payment, and that the
funds are for the Department of Revenue. If your payment covers
multiple tax periods, prepare a separate voucher for each period.

A taxpayer may apply for a waiver if the taxpayer does not have
the capability to file electronically. A waiver may be requested
by filing the (Form 773) Electronic Filing Waiver Application at
least 30 days before the due date of the tax return and before the
return is filed. Do not submit the waiver request with the return.

Contact the Treasury Division for the State of Alaska’s bank
information at [email protected] or 907.465.2320.
Ask your bank to initiate a wire transfer of funds through the
Federal Reserve wire transfer system to be received and credited
to the State of Alaska.

If the Tax Division approves the waiver, please mail the tax return
with attachments to:

If you don’t have email or want confirmation that a wire transfer
was successful, call 907.465.2360.

	
	
	
	

Pay by Check

Tax Division
Alaska Department of Revenue
PO Box 110420
Juneau, AK 99811-0420

Note: Filing a paper return without an approved waiver may result
in a penalty. See this Filing Your Return section, and the Penalties section to the right.

How to Pay

You may pay your taxes electronically through Revenue Online,
http://online-tax.alaska.gov, or access it from our home page at
www.tax.alaska.gov. You may also pay by wire transfer or mail
in a check.
Note: If your payment is $150,000 or more, you must pay
electronically through Revenue Online or by a wire transfer.
See Alaska Administrative Code 15 AAC 05.310 for more
information.

Make checks payable to the State of Alaska. If you are filing your
tax return or report through Revenue Online, print off a payment
voucher to mail in with your check. If you have been granted
an electronic filing waiver, please mail your check with your tax
return or report. In both cases, please mail to:
	
	
	
	

Tax Division
Alaska Department of Revenue
PO Box 110420
Juneau, AK 99811-0420

Penalties
Late Filing of a Return

Returns not filed by the due date are subject to a failure to file
penalty of 5% of the unpaid tax for each 30-day period or portion
of a period the return is late, up to a maximum of 25%.

0405-662SFi 10-13-22 - Page 2

Late Payment of Tax

If the full amount of tax is not paid by the original due date of
the return, even if an extension to file was granted, the return is
subject to a failure to pay penalty of 5% of the unpaid tax for each
30-day period or portion of a period the payment is late, up to a
maximum of 25%. An extension to file is not an extension to pay
taxes. If, during any period or portion of a period, both the failure
to file and failure to pay penalties are applicable, only the failure
to file penalty is imposed.

Interest

Under Alaska Statute 43.05.225, interest will be assessed on any
unpaid or delinquent tax. For current and historical rates, refer to
our website at www.tax.alaska.gov.

Failure to File Electronically

As stated earlier, failure to file electronically without an approved
waiver may result in a penalty. The penalty is (the greater of) $25
or 1% of the total tax due before payments are applied. (See AS
43.05.045 and AS 43.05.220(f).)

Line-by-Line Instructions
Note: Report all income and expenses in U.S. dollars.
If your mine was inactive for the season and you were licensed,
you are still required to file a return. Complete the return placing
zeroes where appropriate.

Page 1
Line 1 – Gross income from mining operation. Enter the gross
income from the mining operation. Gross income is the sale
price, or value actually received, including cash, credits, in-kind
exchange and other valuable consideration received for mined
materials. Include the value of mined materials when the mined
materials were traded for labor.
Line 2 – Royalties received. Enter the total amount of
royalties (cash, credits, in-kind exchanges and other valuable
consideration) received. If the payment received was in kind
(in minerals, for example), include the fair market value of the
minerals on the date that the payment was received. Complete
Schedule C and include the lessee’s name, address and Social
Security number or federal employer identification number and
the amount of royalty received.
Line 3 – Total income from mining operation. Add lines 1 and 2
and enter the result here.
Note: If your only mining income is from receiving royalties,
you may not take any deduction except for depletion under AS
43.65.010(h).
Line 4 – Royalties paid. Enter the total amount of royalties
paid (cash, credits, in-kind exchanges and other valuable
consideration). If the payment was made in kind (such as with
minerals), include the fair market value of the minerals on the
date that payment was made. Complete Schedule B and include
the lessor’s name, address and Social Security number or federal
employer identification number and the amount of royalty paid.
Line 5 – Fuel and oil. Enter the amount of fuel, oil and lubricant
expenses directly related to the mining operation.

Line 6 – Maintenance and repairs. Enter the amount of
maintenance and repair expenses directly related to the mining
operation.
Line 7 – Salaries and wages. Enter the amount of salary and
wage expenses directly related to the mining operation.
Line 8 – Transportation costs. Enter the amount of transportation
costs directly related to the mining operation. Examples include,
but are not limited to, the transportation of the mining equipment
to the claim and the expenses involved in getting employees to
and from the mining operation.
Line 9 – Depreciation. Depreciation on all mining equipment,
buildings and other facilities located in Alaska is allowed as a
deduction. A property’s basis for computing depreciation is the
adjusted basis of the asset for federal income tax purposes on
the date the asset is placed in service in Alaska. Depreciation
on mining assets may be computed using any of the methods
allowed under secs. 167 and 168 of the Internal Revenue Code
(26 U.S.C. 167 and 168). In place of the depreciation expense
deduction, a person may elect to amortize the cost of pollution
control facilities used in the mining operation in accordance with
sec. 169 of the Internal Revenue Code (26 U.S.C 169) (15 AAC
65.125(b)(2)(f)).
Enter the amount of depreciation for the property, plant and
equipment directly related to the mining operation.
Line 10 – Other expenses. Enter the amount of other expenses
directly related to the mining operation. Attach a separate
schedule itemizing the type and amount of other mining
expenses that are not included on lines 4 through 9. Add those
expenses and put the total on line 10.
Line 11 – Total expenses. Add lines 4 through 10 and enter the
result here.
Line 12 – Net income before depletion. Subtract line 11 from line
3 and enter the result here.
Line 13 – Depletion expense. Complete Schedule A to take a
depletion expense.
Line 14 – Taxable income before exemption for new mining
operation. Subtract line 13 from line 12 and enter the result here.
Line 15 – Exemption for new mining operation. An exemption
for the mining license tax is allowed for three and one-half (3½)
years after initial commercial production begins on the property
if the Tax Division has issued a certificate of exemption. Please
contact the division at 907.269.6620 with questions regarding
the exemption.
Line 16 – Net taxable income. Subtract line 15 from line 14 and
enter the result here.
Line 17 – Tax. Enter the amount of tax due using the calculation
instructions below.
Computation of tax. If line 16 is:

•
•

$40,000 or less: the tax is zero.
Over $40,000 and less than or equal to
$50,000: the tax is $1,200 plus 3% of the
excess over $40,000.

0405-662SFi 10-13-22 - Page 3

•

Over $50,000 and less than or equal to
$100,000: the tax is $1,500 plus 5% of the
excess over $50,000.

•

Over $100,000: the tax is $4,000 plus 7% of
the excess over $100,000.

Line 18 – Exploration incentive credit. Enter the amount from line
5 of Form 665 Exploration Incentive Credit.
Line 19 – Enter the amount, if any, from line 4 of Schedule
EC Mining License Tax Education Credit. Contributions used
to calculate a credit against any other taxes (such as Alaska
corporation net income tax) cannot be used as a credit against
the Mining License Tax.
Line 21 – Film production tax credit. Enter the amount of the
film production tax credit from the certificate issued by the
Department of Revenue. You must attach the original certificate
to the tax return.
Line 22 – Amount paid with extension. Enter the amount you paid
with your extension, if applicable.
Line 23 – If filing an amended return, enter the total amount of
tax paid on the original return and/or previous amendments.
Otherwise, enter zero.
Line 24 – Net tax due or (overpayment). Subtract lines 21, 22
and 23 from line 20.

Schedule A – Depletion
Use Schedule A to calculate the allowable depletion deduction for
the mining operation.
Line 1 – Cost or basis of mining property (less residual value).
Enter the purchase cost of the property, plus all development
costs incurred while the property was in the development stage,
less the residual value and the amount of cost or percentage
depletion previously taken as a deduction for this property.
Line 2 – Estimated recoverable units at the beginning of the tax
year. Enter the estimated recoverable reserves remaining at the
end of the tax year plus the units sold in the tax year.
Line 3 – Unit cost. Enter the quotient of line 1 divided by line 2.
This gives the unit cost.
Line 4 – Number of units sold this tax period. Enter the total
number of units sold during the reporting period. Use the same
unit measure as the prior year. This line must be filled out.
Line 5 – Cost depletion deduction. Enter the product of line 3
multiplied by line 4.
Line 6 – Total income from mining operation. Enter the total
from page 1, line 3 of this form (Form 662SF, Mining License Tax
Return – Short Form).
Line 7 – Royalties Paid. Enter the total from Schedule B, line 3 of
this form (Form 662SF).
Line 8 – Depletion base. Subtract line 7 from line 6.
Line 9 – Enter the applicable depletion percentage.

Depletion percentages to be used:
10% Coal mines
15% Metal mines, fluorspar, flake graphite,
vermiculite, beryl, feldspar, mica, talc, lepidolite,
spodumene, varite, ball and sagger clay,
or rock asphalt mines and potash mines or
deposits
23% Sulphur mines or deposits
If the material mined is not listed above, enter 0 on line 9.
Line 10 – Percentage depletion. Multiply line 8 by line 9 and
enter the result here.
Line 11 – Enter the amount from page 1, line 3 of this form (Form
662SF).
Line 12 – Enter the amount from page 1, line 11 of this form
(Form 662SF).
Line 13 – Subtract line 12 from line 11 and enter the result
here.
Line 14 – Limitation. Multiply line 13 by 50%. The percentage
depletion is limited to 50% of the net income from the property
before the depletion deduction.
Line 15 – Compare the amounts on lines 10 and 14 and enter
whichever is less.
	
Line 16 – Depletion deduction. Compare the amounts on
lines 5 and 15 and enter whichever is greater here. Enter the
amount on page 1, line 13 of this form (Form 662SF). The
depletion deduction is the greater of cost or percentage depletion
calculated each year.

Royalties

Enter the name, address and federal employer identification
number of each individual, partnership or corporation to whom
royalties were paid to or royalties received from. Attach a
separate schedule if necessary.
Royalty recipients may not take any deduction except for
depletion under Alaska Statute 43.65.010(h).
Royalties that are paid or received in kind must be reported in
U.S. dollars at the fair market value of the mined material on the
date that payment was paid or received.
Advance royalties should not be included in income until the tax
year in which the mined material relating to the royalty is actually
extracted, per 15 AAC 65.110(a)(2).

Schedule EC – Education Credit
Use this schedule to claim as a credit a portion of contributions to
qualifying Alaska institutions. Subject to the limitations described
in a succeeding paragraph, a taxpayer is allowed a credit for contributions accepted by authorized education institutions.
The education credit is limited to 50% of the first $2,000,000. The
total allowable credit may not exceed $1 million. If a taxpayer is a
0405-662SFi 10-13-22 - Page 4

member of an affiliated group, the total amount of credit may not
exceed $1 million for the affiliated group.
The credit may not reduce the tax liability below zero. Contributions
claimed as a credit on this return cannot be claimed as a credit for
other Alaska taxes. The taxpayer may not claim more than $1
million for all credits claimed under AS 21.96.070, AS 21.96.075,
AS 43.20.014, AS 43.55.019, AS 43.56.018, AS 43.65.018,
AS 43.75.018, and AS 43.77.045. Any unused credit or portion
of a credit may not be sold, traded, transferred or applied in a
subsequent tax year.

Section I - Contributions

Line 1: List all contributions of cash and equipment for which the
credit is claimed.
Column C: Report the code from the table that best describes
the recipient of the contribution.
Column D: List those contributions that qualify.
Line 2: Enter the sum of column D.
Line 3: Enter the lesser of line 2 or $2,000,000.
Line 4: Multiply line 3 by 50%. This is the tentative education
credit. Enter here and on page 1, line 19.
Column C Table - Use the following codes for each contribution

Section II - Equipment Contributions Listed in Section I
Column A: A description of the equipment contributed in sufficient
detail to be easily identified by the recipient organization including make, model number, year, serial number or any other unique
identifying information.
Column B: The original date the equipment was acquired by the
donor.
Column C: The date title of the equipment was transferred to the
recipient organization.
Column D: Donor’s cost or adjusted basis.
Column E: Appraised market value at time of donation. For
equipment donated that exceeds $5,000, a written appraisal from
a qualified appraiser and recipient acknowledgement must be
submitted with Form 662.
Column F: The amount available may be included in Section I,
Column D.

Additional Assistance

These instructions are not in place of Alaska statutes or
regulations and are offered only for the convenience of the
taxpayer in completing the return.
If you have questions or require assistance, contact the Tax
Division at [email protected] or call 907.269.6620.

A Direct instruction, research & educational support by an
Alaska 2-year or 4-year accredited college, Alaska University
Foundation or an elementary or secondary school
B Secondary school level vocational courses operated by an
Alaska school district
C State-operated vocational technical education and training
school, regional training center, and state registered
apprenticeship programs
D Alaska 2-year or 4-year college, elementary, or secondary
school for facilities
E Alaska Native cultural or heritage program for public school
staff and students K–12
F Coastal ecosystem learning center qualified under the
Coastal America Partnership
G Alaska higher education investment fund under AS 37.14.750
H Non-profit organization to fund scholarship for a dual-credit
student as defined in AS 43.20.014 (g)(1)
I

Residential school approved under AS 14.16.200

J

Childhood learning and development programs provided by a
non-profit organization

K Science, technology, engineering, and math programs provided by a non-profit agency or school district for students
K-12 and staff
L Non-profit organization providing educational opportunities
for public service
Note: The above list of qualifying recipients is intended as a
general description only. Please see AS 43.65.018(a) for details
of requirements. Taxpayers are encouraged to consult their tax
advisor.

0405-662SFi 10-13-22 - Page 5