Alabama Sales Tax

On this page you will find handy sales and use tax information about Alabama.

How to use this page:

We’ve pulled in the information from all our Charts for a consolidated view by state.  Here you can see the sales tax rates and if the state has remote seller nexus rules. You can also see any sales tax holidays or amnesty programs that may exist, though these do not apply to all states.

Below the chart you can find any News & Tip item we have published that relates to Alabama that you can filter by topic. This will help you get informed on current and past legislation that has passed in the state.

State Rate

4.000%

Range of Local Rates

0% – 9.0% Some local jurisdictions do not impose a sales tax.

Local Rates Apply to Use Tax

Yes/No  Some of the cities and counties do apply use tax.

AFFILIATE NEXUS

8/24/2012

REPORTING REQUIREMENTS

7/1/2017

ECONOMIC NEXUS

10/1/2018see state notice

MARKETPLACE NEXUS

1/1/2019

Annual Back to School Holiday

July 15-17, 2022

1. Clothing – $100 or less per article (excluding accessories and protective or recreational equipment)
2. Single purchases ($750 or less) of computers, computer software, and school computer supplies (excluding purchases for commercial use)
3. Noncommercial school supplies – $50 or less per item
4. Noncommercial purchases of books – $30 or less per item

Note: not all counties and municipalities are participating in the sales tax holiday. Click here to view an updated chart listing participation.

Annual Severe Weather Holiday

February 25-27, 2022

Severe weather preparedness items – $60 or less per item, except for generators and power cords, which are covered so long as they cost $1,000 or less. Note: not all counties and municipalities are participating in the sales tax holiday. Click here to view an updated chart listing participation.

Status

Inactive

Amnesty Filing Dates

June 30, 2016 - August 30, 2016

Go to Alabama Amnesty Page
AMNESTY INCLUSION PERIODS

Taxes due prior to January 1, 2015 or taxes for taxable periods that began before January 1, 2015 are eligible.

TAX TYPES AND CONDITIONS

All taxes administered by the Alabama Department of Revenue, except for motor fuel taxes and certain penalties

AMNESTY BENEFITS

50% of interest and all penalties waived.

Status

Inactive

Amnesty Filing Dates

July 1, 2018 - September 30, 2018

Go to Alabama Amnesty Page
AMNESTY INCLUSION PERIODS

Taxes due prior to January 1, 2017 and taxes for taxable periods that began before January 1, 2017.

TAX TYPES AND CONDITIONS

All taxes administered by the Alabama Department of Revenue except for motor fuel, motor vehicle, and property taxes.

AMNESTY BENEFITS

Waiver of penalties and interest. However, penalties may be imposed for reasons such as failing to comply with the amnesty provisions, providing false or fraudulent information, and/or cost of collection penalties.

Status

Active

Amnesty Filing Dates

Amnesty is provided to any eligible seller who applies and is accepted to participate in the Simplified Seller’s Use Tax (SSUT) Program

Go to Alabama Amnesty Page
AMNESTY INCLUSION PERIODS

Periods preceding October 1, 2019

TAX TYPES AND CONDITIONS

Simplified sellers use tax. Seller must apply for and be accepted into SSUT program. Amnesty isn’t available to any eligible seller who has received notice of an audit and the audit is not yet resolved.  Amnesty only applies to retailers responsible for collection of the tax and not for purchasers subject to consumer’s use tax.

AMNESTY BENEFITS

Waiver of penalties and interest, and no class action may be brought against an eligible seller in any court of this state on behalf of customers for an overpayment of simplified sellers use tax.

Administration Information
Streamlined Sales Tax Status

Advisory State

NUMBER OF TAXING AUTHORITIES

801 Sales Tax Jurisdictions

HOME RULE AUTHORITIES

Yes – Combination; some are state administered

Sales Tax Sourcing (Intrastate)

Destination

Sales Tax Return Due Date

The 20th of the month following the reporting period

Exemption Information
RESALE CERTIFICATE

Alabama Resale Certificate

TYPES OF EXEMPTIONS

Product types of exemptions: prescription drugs, gasoline and motor oil, fertilizer, seeds, livestock feed, labor to repair or install property if billed separately

 

Entity types of exemptions:  sales to the government, schools, city and county owned hospitals, and specific nonprofits,

 

Alabama Exemption Certificate Forms

State Links
History & Fun Facts
HISTORY

Alabama enacted its sales and use tax in 1936. It was re-enacted twice, once in 1939 and again in 1959.

FUN FACTS
  • Alabama was one of the five states with the highest combined state and local tax rates in 2018, at 9.10%.

State Notices & Resources for Remote Sellers

Use this state by state guide to find each state\’s initial guidance on how to proceed post-Wayfair, state resources such as FAQs, and any state activity such as going through a legislative process that impacts remote sellers.

How Home Rule States Have Responded to Wayfair

Let’s take a look at three of the primary home rule states that also have a state-wide sales tax—Alabama, Colorado, and Louisiana—to understand steps taken what remote out-of-state sellers can expect.

Economic Nexus State by State Chart

Key information such as effective dates, thresholds, and includable sales for out-of-state sellers making sales into states that have enacted economic nexus legislation both before and after the South Dakota v. Wayfair Supreme Court decision.

Three Years of South Dakota v. Wayfair: Local Tax Issues

Learn why managing local taxes is such a large challenge for taxpayers post-Wayfair and about local efforts to simplify compliance. This is part 4 of our 5 part series on three years of the Wayfair decision.

Post-Wayfair Remote Seller Nexus: What’s Going on in the Southeast?

Like the rest of the country, the Southeast region of the U.S. is not immune to the changes created by the South Dakota v. Wayfair decision. In fact, 2020 presented a slew of changes in the southeast that have big…

October 1, 2018 Remote Seller Deadline for Multiple States

The October 1, 2018 remote seller compliance deadline is approaching for a number of states. Click on the links below for our previous news items with more details. Alabama Enacts Economic Nexus Provision Illinois Enacts Economic Nexus Legislation Indiana Enacts…

House Introduces Online Sales Simplicity and Small Business Relief Act of 2018

On September 13, 2018, Rep. Jim Sensenbrenner (R-WI) and additional U.S. House members introduced the Online Sales Simplicity and Small Business Relief Act of 2018.

Remote Seller Resources

Comprehensive list of resources for remote sellers following the South Dakota v. Wayfair Supreme Court decision – including state notices, videos, articles, training opportunities, and more.

U.S. Supreme Court Issues Decision In South Dakota v. Wayfair

On June 21, 2018, the U.S. Supreme Court issued its decision in the South Dakota v. Wayfair case, ruling in favor of South Dakota and overturning Quill’s physical presence rule.

South Dakota v. Wayfair Analysis & Predictions: Sales Tax Experts Weigh-In

Sales tax experts lend their insight into and predictions for one of the most important U.S. Supreme Court decisions regarding sales tax in decades, South Dakota v. Wayfair.

Alabama Enacts Marketplace Nexus Provisions

Alabama has enacted legislation containing marketplace nexus provisions, effective January 1, 2019.

Record Number of Sellers Participate in 2017 MTC Amnesty Program

The volume of applicants for the 2017 online marketplace seller tax amnesty program overwhelmed the Multistate Tax Commission.

Multistate Tax Commission Announces Tax Amnesty Program for Online Sellers

The MTC organized a tax amnesty program for online sellers, running from August 17 to November 1, 2017. The voluntary disclosure program allowed sellers to start remitting sales tax on future sales without penalty or liability for unpaid, prior accumulated sales tax in 25 participating states.

No Regulation Without Representation Act of 2017 Introduced

Under the proposed House bill, a state may tax or regulate a person’s activity in interstate commerce only when the person is physically present in the state during the period in which the tax or regulation is imposed.

Congress Introduces Marketplace Fairness Act of 2017 and Remote Transactions Parity Act of 2017

Introduced on April 27, 2017, the Marketplace Fairness Act of 2017, if enacted, would authorize states meeting certain requirements to require remote sellers that do not meet a small seller exception to collect their state and local sales and use taxes.

Alabama Enacts Use Tax Notice and Reporting Requirements Legislation

On March 22, 2017, the Alabama Department of Revenue was authorized to require non-collecting remote sellers to remote Alabama sales to the DOR and notify Alabama customers of their use tax obligations.

Online Sales Simplification Act of 2016 Discussion Draft is Introduced

The proposed legislation would implement a “hybrid origin” approach for remote sales. States could impose sales tax on remote sales if the origin state participates in a clearinghouse.

No Regulation Without Representation Act of 2016 Introduced

Taking the opposite approach of the Marketplace Fairness Act and Remote Transactions Parity Act, the proposed bill would limit the ability of states to require remote sellers to collect use tax. However, the bill failed to pass.

Out of State Book Retailer Subject to Use Tax in Alabama

Alabama held that an out-of-state retailer that sold books and educational materials was subject to Alabama use tax since the taxpayer had sufficient contacts or nexus in Alabama to require it to collect, report, and remit use tax.

Alabama Enacts Economic Nexus Provision

Alabama enacted a new economic nexus rule applying to out-of-state sellers, effective 10/22/15. More…

House Introduces Remote Transactions Parity Act of 2015

U.S. House of Representatives introduced the Remote Transactions Parity Act of 2015 on 06/15/15. More…

Senate Introduces Marketplace Fairness Act of 2015

On March 10, 2015, a bipartisan group of senators introduced the Marketplace Fairness Act of 2015.

Alabama Adopts New Local Nexus Rule

Alabama has adopted a new nexus rule outlining a business’s obligation to collect and remit local (county and municipal) sales and use tax, whether or not that business has a permanent physical location in the state. The rule will apply…

Federal Government Introduces New Remote Seller Bill

The federal Marketplace Fairness Act of 2013 was introduced in the House of Representatives and the Senate on February 14, 2013. If passed, the bill would authorize states that meet certain requirements to require remote sellers that do not meet…