Flag_of_Alabama.svg
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.

Services

Services

Business and License

Business and License

Collections

Collections

Entity Registration

Entity Registration

Human Resources

Human Resources

Income Tax

Income Tax

Legal

Legal

Motor Vehicle

Motor Vehicle

Property Tax

Property Tax

Sales and Use

Sales and Use

Tax Incentives

Tax Incentives

Tax Policy

Tax Policy

  • Homepage
  • >
  • What taxes are allowed as credits?

What taxes are allowed as credits?

State, county and city sales and use taxes paid on tangible personal property purchased and paid for by the institution for its consumption;
State utility taxes paid on telephone, electrical power, gas or water;
Rental or leasing taxes paid directly to the State for the privilege of leasing tangible personal property to others within the State of Alabama;
Increases in the city or county license taxes imposed upon financial institutions between July 10, 1943 and October 1, 1951.
Credits will not be allowed on any taxes not levied on the financial institution.

Examples of these taxes:

State, county or city sales or use taxes on items purchased for resale such as checks, promotional items or equipment;
Gross receipts taxes levied on the seller;
Rental or leasing taxes paid to others;
Federal taxes of any nature;
Taxes paid to contractors or others on equipment attached to real property or in the construction of buildings, etc.;
the tax imposed by this chapter.
The Alabama Department of Revenue now requires the use of Schedule EC, when claiming business tax credits.

Taxes not taken as a credit may be allowed as a deduction.

State, county and city sales and use taxes paid on tangible personal property purchased and paid for by the institution for its consumption;
State utility taxes paid on telephone, electrical power, gas or water;
Rental or leasing taxes paid directly to the State for the privilege of leasing tangible personal property to others within the State of Alabama;
Increases in the city or county license taxes imposed upon financial institutions between July 10, 1943 and October 1, 1951.
Credits will not be allowed on any taxes not levied on the financial institution.

Examples of these taxes:

State, county or city sales or use taxes on items purchased for resale such as checks, promotional items or equipment;
Gross receipts taxes levied on the seller;
Rental or leasing taxes paid to others;
Federal taxes of any nature;
Taxes paid to contractors or others on equipment attached to real property or in the construction of buildings, etc.;
the tax imposed by this chapter.
The Alabama Department of Revenue now requires the use of Schedule EC, when claiming business tax credits.

Taxes not taken as a credit may be allowed as a deduction.

Related FAQs in Deductions and Credits, Financial Institution Excise 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.