Alabama Department Of Revenue, Alabama Tax

Alabama Business Corporate Tax, Alabama Personal Income Tax, Alabama Sales Tax Rates

The taxes Alabama businesses pay each year:

Alabama corporations (C corps)

Alabama corporate net income tax = 6.5%
Alabama business privilege tax = $100 minimum
Federal corporate tax rate= 15% to 35%
Alabama limited liability companies (LLCs), LPs, LLPs, and S Corps

AL personal net income tax rates: 0 to $500 = 2%; $500 to $3000 = 4%; $3000+ = 5%
Alabama local city/county income tax = .19
Federal personal income tax rates = 10% to 39.6%

To learn more about these entities, see our Alabama LLC or Alabama corporation pages.

What is Alabama’s average sales tax rate?

6.15%. The state has a 4% tax rate, but average local sales tax rates equal 2.15% adding up to 6.15%.

Alabama standard deductions?

Single: $2000
Joint: $4000

Personal exemptions in Alabama?

Single: $1500
Dependents: $300

What tax forms do Alabama businesses file?

C corporations: Form 20C-Alabama Corporation; 20-C-C for Alabama consolidated corps.
S corporations: Form 20S, Schedule K1, and NRA for non-resident shareholders
LLCs (with multiple members), LPs, and LLPs: Form 65, Schedule K1
Individuals: Form 40,Schedule C

How Should Alabama Businesses Estimate Taxes?

Form 40ES if estimated tax will be at least $100 for income from non-wage profits of $3,500 or more. Follows federal estimated tax format.

If you use Northwest Registered Agent as your registered agent, you’ll have an online account to track your AL LLC or corporation in Alabama, receive notification reminders to file your annual reports on time, annual tax reminders, and new State information reminders. All for a low annual flat rate fee of $125 a year. We also help incorporate new Alabama businesses for only $100.