The utility service use tax is an excise tax levied on the storage, use, or other consumption of electricity, domestic water, natural gas, telegraph, and telephone services in the State of Alabama. The authority for collecting the utility service use tax is found in Sections 40-21-100 through 40-21-107, Code of Alabama 1975.
The amount of the tax shall be determined by the application of rates against the sales price of such services in the State of Alabama. The tax shall be computed monthly with respect to each person to whom such services are furnished, in accordance with the following table:
| If the total sales price of the utility services furnished by a utility and stored, used, or otherwise consumed by a person in one month: | The tax with respect to the utility is: |
| Not over $40,0000 | 4 % of such gross sales or gross receipts |
| Over $40,000 but not over $60,000 | $1,600 plus 3% of excess over $40,000 |
| Over $60,000 | $2,200 plus 2% of excess over $60,000 |
The rate of tax against the sales price of such telegraph services or telephone services in the State of Alabama is 6% on all gross sales or gross receipts.
The utility service use tax is due monthly, with returns and remittances to be filed through the My Alabama Taxes (MAT) filing system on or before the 20th day of the month for the previous month’s sales. The utility service use tax provider is entitled to a collection fee in consideration of the costs incurred by the utility provider in collecting and remitting the tax levied by Section 40-21-102, Code of Alabama 1975; the amount deducted and retained by such provider shall be one-fourth of one percent of the gross amount of such tax billed. Note: If paying via EFT, the EFT payment information must be transmitted by 4:00 p.m. (Central Standard Time) on or before the due date, to be considered timely paid.
In Alabama, a resale certificate is officially called a “Sales Tax License”. To get a copy of your Alabama resale certificate or Sales Tax License, you should:
Login to MAT, locate the appropriate tax account, locate and click “Print tax account license” link. If you need help or cannot access your certificate online contact the Alabama Department of Revenue Sales and Use Tax Division for assistance.
Yes. In accordance with Rule 810-6-1-.144.03: All buyers of property for resale purposes are entitled to purchase at wholesale, tax-free, the property they resell as regular course of business when they have secured the sales tax license required by law. This rule also applies to retailers located outside Alabama when they have secured the sales tax license required by law in the state in which they are located.
A credit card transaction fee is a charge added to the regular price of an item by a retailer when the purchaser pays for the item using a credit card. Other names for this fee include swipe fee, credit card surcharge, processing fee, service charge, or convenience fee.
These fees are subject to sales and use tax and should be included in the seller’s gross sales on retail transactions when calculating tax due. Example: A sale of tangible personal property totals $100. The customer pays with a credit card and is charged a $3 credit card transaction fee. The total price of $103, including the credit card transaction fee, is subject to sales and use taxes.
A credit card fee, even if separately stated, is part of the retailer’s cost of doing business, and the entire consideration for the sale of tangible personal property is subject to sales and use taxes.
If a transaction consists of only non-taxable goods or services, the credit card transaction fee is not subject to sales and use taxes. Example: A customer is charged $50 for a haircut. The customer pays with a credit card and is charged a $3 credit card transaction fee. Since the haircut is not subject to sales and use taxes, the corresponding credit card transaction fee is not subject to sales and use taxes.
When trying to complete title applications for vessels that have inches listed on the MSO, please use this Vessel Length Chart for conversion purposes.
Yes, Alabama allows resident individuals to claim a tax credit for income taxes imposed by other states. This credit is claimed on Form 40, Schedule CR. A copy of the other state’s return and a copy of the state Schedule K-1 should be included as documentation of this credit.
If the individual does not file an individual income tax return in the other state or the state provides an exclusion of income, include a proforma return calculating the tax at the other state’s rate and a copy of the state Schedule K-1 as documentation of this credit.
Note: Any Pass-Through Entity tax deducted on the Pass-Through Entity’s federal return, which reduces the taxable income reported on the owner’s K-1, should be added back to compute Alabama taxable income.
No, if the current title is an Alabama ELT there is no cost to print a physical title.
However, once an ELT is printed on physical title paper it can not be printed again. A replacement title application must be applied for if a replacement is needed.
