Alabama Basic Business Taxes 2010
Alabama's economic development, finance and tax organizations provide a range of incentive programs to initiate new business and commercial investment. Specific programs include the Alternative and Renewable Energy Act of 2008, Net Operating Loss Carry-forward, and Small business/employee health tax deductions.
Feb/Mar 10
For domestic corporations (Alabama corporations), rate is 6.5 percent of the net income annually. Deductions are allowed for federal income tax paid or accrued. For foreign corporations (companies incorporated outside the state), rate is 6.5 percent of the income annually from business within the state. Deductions are allowed for federal income tax paid or accrued. (Capital credits may apply.)
Net Operating Loss Carry-forward:
Corporate income tax law provides for a 15-year carry-forward of net operating losses.
Small business/employee health insurance costs:
The plan allows business owners with fewer than 25 employees to deduct 150 percent of the amount they pay for employee health insurance premiums from their state income taxes. The plan also allows employees of small businesses earning $50,000 or less annually to deduct 150 percent of what they pay for health insurance from state income taxes.
Alternative and Renewable Energy Act of 2008:
Among other measures, the act provides tax credits and abatements for various energy-related expenditures.
Sales and use taxes:
A 4 percent sales tax is based on gross retail sales and gross proceeds derived by lessors for leases or rentals. A 4 percent use tax is levied on all items purchased out of state but consumed, stored, or used inside the state. Items subject to the sales tax are exempt from use tax. Manufacturing equipment is taxed at 1.5 percent. Sales and use tax on all building material, machinery, and equipment for a qualified industrial project may be exempt, except for the local educational portions of the tax. (Non-educational abatements may apply.)
Property tax:
The state tax is 6.5 mills. Additional tax may be levied by counties and municipalities and the local rate is an aggregate of all lawful levies. The assessment ratio for industrial property is 20 percent of fair market value. (Non-educational abatements may apply.)
Alabama State Contact:
Alabama Development Office
Alabama Center for Commerce
401 Adams Avenue
Montgomery, AL 36130
Incentive and tax information is provided to Area Development by each state's economic development or commerce agency for information purposes only and is subject to revision at any time by the state government. Please contact the state agency directly for full requirements and offerings.
Project Announcements
Tquila Automation Plans Birmingham, Alabama, Regional Delivery Center
05/05/2023
Canada-Based Epsilon Industries Plans Tuscaloosa, Alabama, Prefabricated Modular Utility Systems Plant
03/28/2023
Global Resources International Plans Columbia, Alabama, Operations
03/21/2023
Sunbelt Solomon Services Plans Elba, Alabama, Manufacturing Plant
03/17/2023
Most Read
-
Is a Flurry of Fads Shaping Economic Development Policy?
Q2 2023
-
37th Annual Corporate Survey: Economic Pressures Exerting Greatest Effect on Decision-Makers
Q1 2023
-
Nearshoring — North America’s Next Factory
Q2 2023
-
First Person: Labor Crunch in the Construction Industry
Q2 2023
-
Front Line: Water Supply Increasingly Affecting Location Decisions
Q2 2023
-
19th Annual Consultants Survey: Clients Challenged by Tight Labor Market, Energy Availability
Q1 2023
-
Life Science Conversions in Real Estate
Q2 2023