If property is transferred to a relocation company, is the relocation company subject to the withholding requirements of Section 40-18-86, Code of Alabama 1975?
Is a single-member limited liability company (SMLLC) whose status is disregarded for federal income tax purposes considered to be the seller for purposes of Section 40-18-86, Code of Alabama 1975?
One of the conditions for a nonresident seller to be considered a deemed resident under Section 40-18-86, Code of Alabama 1975, is that the seller has filed Alabama income tax returns, or appropriate extensions, for the two income tax years immediately preceding the year of the sale. What if the sale occurs before the due date for the previous year’s income tax return?
Can a nonresident seller qualify as a deemed resident in order to be exempt from withholding, if he satisfies some, but not all of the listed conditions?
If the seller is a corporation, how does it claim the withholding credit since the corporation income tax return does not have a line for tax withheld?
If tax is withheld from a nonresident seller who is a partnership, S corporation, or limited liability company, how does the seller claim credit for the withholding?
Does the withholding required under Code of Alabama 1975, Section 40-18-86, apply to the sale or transfer of timber located in Alabama by a nonresident of Alabama?
If an Alabama resident relocates to another state and buys another residence, does his Alabama residence cease to be his principal residence for purposes of Alabama law?
Is withholding required on a transaction that qualifies as a Section 1031 exchange under the Internal Revenue Code? What if the transaction is a “deferred” Section 1031 exchange?
If a buyer reasonably relies on a seller’s sworn affidavit of residency, will the buyer be liable if it later turns out that the seller does not meet the conditions of deemed residency?
Section 40-18-2, Code of Alabama 1975, imposes a tax on every nonresident individual receiving income from property owned or business transacted in Alabama. Also, Section 40-18-14 states that the taxable income of a nonresident individual includes only income from property owned or business transacted in Alabama. An installment note, held by someone who is not in the business of holding installment notes, derived from the sale of investment real property or rental real property by a nonresident individual, would be intangible property that was acquired as income from property held in this state or as a result of business done in this state. “Business income” is defined in Section 40-27-1, Code of Alabama 1975, as income arising from transactions and activities in the regular course of the taxpayer’s trade or business and includes income from tangible and intangible property if the acquisition, management, and disposition of the property constitute integral parts of the taxpayer’s regular trade of business operations. Accordingly, interest that is attributable to the installment note in this situation is taxable for Alabama purposes. Is the interest from the installment note subject to the withholding requirements of Section 40-18-86, Code of Alabama 1975?
Is property that is sold or transferred by a nonresident as part of an installment transaction subject to the withholding requirements of Section 40-18-86, Code of Alabama 1975, and if so, how is withholding on the installment sale handled?
