FAQs Archive - Alabama Department of Revenue

An official website of the Alabama State government.

The .gov means it's official

Government websites often end in .gov or .mil. Before sharing sensitive information, make sure you’re on an official government site.

The site is secure

The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Frequently Asked Questions

Filter FAQs

Category /Tax

Showing (75) FAQs

Question	Category	Read More
Are rollovers from a CollegeCounts 529 Plan to Roth IRA exempt from current year Alabama Income Tax?	Income Tax ,
What is the Alabama state income tax deduction for contributions to the Alabama ABLE Savings Plan?	Income Tax ,
Does Alabama income tax law recapture previously deducted contributions when withdrawing money from an Alabama ABLE Savings Plan for non-qualified expenses?	Income Tax ,
What is the Alabama state income tax deduction for contributions to the CollegeCounts 529 Plan?	Income Tax ,
Does Alabama income tax law recapture previously deducted contributions when withdrawing money from a CollegeCounts 529 Plan for non-qualified expenses?	Income Tax ,
When rolling over an out-of-state 529 plan to the CollegeCounts 529 Plan, is the rollover into the fund (contributions and earnings) exempt from any current year Alabama income tax?	Income Tax ,
Are guaranteed payments included in the calculation of taxable income?	Electing Pass-Through Entity
Can an Electing Pass-Through Entity exclude income attributable to certain owners, i.e. tax-exempt owners, when calculating tax due?	Electing Pass-Through Entity
How is the federal taxable income for S corporations and limited liability entities determined?	Medical Cannabis Privilege Tax
How do you claim credits that do not require pre-certification by an individual income taxpayer?	Tax Incentives ,
Who should you contact for assistance with the credit submission process or questions about individual income tax credits?	Tax Incentives ,
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?	Income Tax ,
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?	Income Tax ,
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?	Income Tax ,
Are only transactions which result in taxable income to the seller subject to withholding?	Income Tax ,
So the nonresident seller is still required to file an Alabama income tax return, even with the withholding?	Income Tax ,
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?	Income Tax ,
Who should you contact for assistance with the credit submission process and/or questions about business income tax credits?	Tax Incentives ,
If I am not a resident of Alabama, but earned income from Alabama sources, am I required to file an Alabama tax return?	General
Most of my business equipment has been fully depreciated on my income tax return; do I still list these items on the personal property return?	Personal Property
Is withholding required from 1099 Distributions?	Withholding Tax
Is the Fiduciary Income Tax Return, Form 41, under the e-file mandate?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
When is a self-prepared Fiduciary return included in the mandate?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
1099-NEC Filing	Withholding Tax
Do I need a withholding tax account number?	Withholding Tax
I have hired a sitter or someone to help in my home, am I required to withhold Alabama income tax from their wages?	Withholding Tax
What is the mailing address for Form PTE-C?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
I overpaid my withholding tax, how should I handle this?	Withholding Tax
How does a preparer know if he or she is required to electronically file a corporate/partnership return this year?.	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
When is a self-prepared corporate or partnership return included in the mandate?.	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
When is the Corporate/Partnership Income Tax e-file mandate effective?.	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
We have a Section 125 Cafeteria Plan available to our employees, does the State of Alabama recognize this exclusion from gross income?	Withholding Tax
We have employees who will be receiving severance pay. Is this income taxable to the recipient?	Withholding Tax
Are estimate payments required?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Is there a limitation on the amount of contributions deductible?	Financial Institution Excise Tax ,
Since Credit Unions do not have Federal Taxable Income, what should a credit union report on the Form ET-1 line 1 Federal Taxable Income?	Financial Institution Excise Tax
How does a preparer know if he or she is required to electronically file a corporate/partnership return next year?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Can the federal income tax paid on federal Form 1041 be claimed as a deduction on the Alabama Form 41?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
How does a preparer know if he or she is required to electronically file a Fiduciary return?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
When is a self-prepared corporate or partnership return included in the mandate?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
When is the Corporate/Partnership Income Tax e-file mandate effective?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
How does a partnership file for an extension?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Is a single member LLC required to file a separate Alabama income tax return?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
What is the mailing address for Form 65?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Are any employees exempt from withholding tax?	Withholding Tax
How can I check on my individual income tax refund?	Withholding Tax
How do I amend Form W-2?	Withholding Tax
Who may file consolidated returns?	Financial Institution Excise Tax ,
Can a financial institution elect to file a consolidated Alabama Financial Institution Excise Tax Return?	Financial Institution Excise Tax ,
Does Alabama have a minimum financial institution excise income tax?	Financial Institution Excise Tax ,
What is the correspondence mailing address for the Financial Institution Excise Tax Section?	Financial Institution Excise Tax ,
Does Alabama accept consolidated S returns?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Does Alabama accept the federal extension for S corporations?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Does Alabama allow the filing of composite returns for S corporation shareholders?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Does our corporation have Nexus in Alabama?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
How do I claim a business credit?	Financial Institution Excise Tax ,
How does a preparer know if he or she is required to electronically file a corporate/partnership return next year?.	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
What are the filing requirements for a corporation operating in Alabama as a partner in a partnership?	Corporate Income Tax
When are corporations required to pay electronically?	Corporate Income Tax
What are the reporting requirements as the result of an IRS audit?	Financial Institution Excise Tax ,
Who must file a Corporate Income Tax return (Form 20C)?	Corporate Income Tax
Does our partnership have Nexus in Alabama?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
Does our financial institution have Nexus in Alabama?	Financial Institution Excise Tax ,
How does a preparer know if he or she is required to electronically file a corporate/partnership return this year?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
What is a QIP (Qualified Investment Partnership)?	and Fiduciaries , Limited Liability Entities , Partnerships , S-Corporations ,
What types of interest income is taxable?	Financial Institution Excise Tax ,
Where can I find more information pertaining to consolidated financial institution excise tax returns?	Financial Institution Excise Tax ,
What is the current tax rate?	Financial Institution Excise Tax ,
What is the mailing address for Form ET-1/ET-1C?	Financial Institution Excise Tax ,
How should financial institutions treat NOLs?	Financial Institution Excise Tax ,
Does Alabama provide for a federal income tax deduction?	Financial Institution Excise Tax ,
Are deductions for dividends allowed?	Financial Institution Excise Tax ,
Is interest expense allowed as a deduction?	Financial Institution Excise Tax ,
Does the corporation have to file corporate income tax if there is no business activity or never began, but is registered with the Alabama Secretary of State?	Corporate Income Tax
What is an Electing Family Limited Liability Entity?	Business Privilege Tax