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  • Who must file a Financial Institution Excise Tax return? (Form ET-1)

Who must file a Financial Institution Excise Tax return? (Form ET-1)

Any person, firm, corporation and any legal entity whatsoever doing business in this state as a national banking association, bank, banking association, trust company, industrial or other loan company or building and loan association, and such term shall likewise include any other institution or person employing moneyed capital coming into competition with the business of national banks, and shall apply to such person or institution regardless of what business form and whether or not incorporated, whether of issue or not, and by whatsoever authority existing.

Act 99-665 requires all financial institutions conducting a credit card business through the issuance of credit cards to Alabama residents or businesses to file a financial institution excise tax return and pay any tax due. No place of business is required.

Financial institution shall not mean or include individual citizens and fiduciaries acting in a representative capacity for individual citizens, not engaged in a banking, loan, investment or similar business, but merely making personal investments of personal or fiduciary funds in bonds, notes or other evidences of indebtedness and not made in competition with the business of national banks, nor shall such term apply to insurance companies or insurance associations merely making investments of reserves in bonds, notes or other evidences of indebtedness and not made in competition with the business of national banks.

Any person, firm, corporation and any legal entity whatsoever doing business in this state as a national banking association, bank, banking association, trust company, industrial or other loan company or building and loan association, and such term shall likewise include any other institution or person employing moneyed capital coming into competition with the business of national banks, and shall apply to such person or institution regardless of what business form and whether or not incorporated, whether of issue or not, and by whatsoever authority existing.

Act 99-665 requires all financial institutions conducting a credit card business through the issuance of credit cards to Alabama residents or businesses to file a financial institution excise tax return and pay any tax due. No place of business is required.

Financial institution shall not mean or include individual citizens and fiduciaries acting in a representative capacity for individual citizens, not engaged in a banking, loan, investment or similar business, but merely making personal investments of personal or fiduciary funds in bonds, notes or other evidences of indebtedness and not made in competition with the business of national banks, nor shall such term apply to insurance companies or insurance associations merely making investments of reserves in bonds, notes or other evidences of indebtedness and not made in competition with the business of national banks.

Related FAQs in Filling Requirements, 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.