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Income to Be Reported on the Alabama Income Tax Return

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  • Income to Be Reported on the Alabama Income Tax Return
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All income is subject to Alabama income tax unless specifically exempted by state law. The term “income” includes, but is not limited to:

  • Wages including salaries, fringe benefits, bonuses, commissions, fees, and tips.
  • Dividends.
  • Interest on: bank deposits, bonds, notes, Federal Income Tax Refunds, mortgages on which you receive payments, accounts with savings and loan associations, mutual savings banks, credit unions, etc.
  • Original Issue Discount.
  • Distributions from an Individual Retirement Arrangement (IRA) including SEPs and DECs, if you  excluded these amounts in a prior year.
  • Bartering income (fair market value of goods or services you received in return for your services).
  • Business expense reimbursements you received that are more than you spent for the expenses.
  • Amounts received in place of wages from accident and health plans (including sick pay and disability pensions) if your employer paid for the policy.
  • Alimony or separate maintenance payments received from and deductible by your spouse or former spouse.
  • Life insurance proceeds from a policy you cashed if the proceeds are more than the premium you paid.
  • Profits from businesses and professions (Federal Schedule C or C-EZ).
  • Your share of profits from partnerships and S Corporations (Schedule E).
  • Profits from farming (Federal Schedule F).
  • Pensions, annuities, and endowments.
  • Lump sum distributions.
  • Gains from the sale or exchange (including barter) of real estate, securities, coins, gold, silver, gems, or other property (Schedule D).
  • Gains from the sale of your personal residence (Federal Form 2119).
  • Rents and Royalties (Schedule E).
  • Your share of estate or trust income (Schedule E).
  • Prizes and awards (contests, lotteries, and gambling winnings).
  • Directors fees.
  • Fees received as an executor or administrator of an estate.
  • Embezzled or other illegal income.
  • Refunds of federal income tax if deducted in a prior year and resulted in a tax benefit.
  • Payments received as a member of a military service are taxable except for combat pay and certain allowances.
  • Property transferred in conjunction with performance of services.
  • Jury duty pay.