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  • Do I need a withholding tax account number?

Do I need a withholding tax account number?

If you are an employer with employees working in the state of Alabama, you will need to register with the Department of Revenue for a withholding tax account number. If you are an Alabama employer with Alabama residents working outside the state of Alabama, you will need to withhold Alabama income tax on those residents unless you are withholding tax for the state in which the employee is working in. To obtain a withholding tax account number, employers must complete the Application available online at MyAlabamaTaxes.alabama.gov. (MAT) Please go to “I Want To” then “Obtain a new Tax Account”. NOTE: New account numbers assigned will consist of 10 alphanumeric characters beginning with an “R.” Please make sure that the payroll software provider or program that you will be using is aware of the correct account number.

If you are an employer with employees working in the state of Alabama, you will need to register with the Department of Revenue for a withholding tax account number. If you are an Alabama employer with Alabama residents working outside the state of Alabama, you will need to withhold Alabama income tax on those residents unless you are withholding tax for the state in which the employee is working in. To obtain a withholding tax account number, employers must complete the Application available online at MyAlabamaTaxes.alabama.gov. (MAT) Please go to “I Want To” then “Obtain a new Tax Account”. NOTE: New account numbers assigned will consist of 10 alphanumeric characters beginning with an “R.” Please make sure that the payroll software provider or program that you will be using is aware of the correct account number.

Related FAQs in Withholding Tax

The ONE SPOT system will allow returns to be filed with ACH Debit and ACH Credit method payments only. The system will not allow an ACH Debit taxpayer to complete their return filing without completing the necessary information to authorize the ACH Debit payment. The ACH Credit payment is separate from the ONE SPOT system and must be initiated by the taxpayer through their banking institution. Returns successfully submitted for ACH Debit and ACH Credit taxpayers will be exported to the local government.

Upon the completion of the Third Party Designation Form, ALDOR can provide the returns, payments and payment data files to the authorized third party administrator.

When an electronic payment is received by ALDOR in error, the payment will post to the taxpayer’s ALDOR local tax account. ALDOR will not be able to automatically transfer these payments to the non-administered local government due to the possibility the taxpayer’s payment will reject after ALDOR has transferred the payment, causing complicated collection issues. ALDOR will need the taxpayer to advise the Department with what to do with that payment.

The only non-administered local government taxes to be processed through ALDOR will be payments received as the result of legal action, such as final assessment, garnishments, and liens, entered into when the local government was state administered. Payment data for these payments will be available during the first week (5-10 working days) of the month following the tax collection period through the ALDOR website.