Alabama Tax Changes - October 2024

Week Of 10.21.2024

Alabama Sales & Use Taxes—Change in reporting of Tallassee (Alabama) rental and lodging taxes.

The Alabama Department of Revenue has announced that, effective with the period ending November 30, 2024, due on or before December 20, 2024, City of Tallassee rental tax (auto, general, and linens) and lodgings tax are to be remitted in My Alabama Taxes (MAT) using either locality code 9563 (Tallassee Lodg & Rental Within Tallapoosa Co) or locality code 9564 (Tallassee Lodg & Rental Within Elmore Co), depending on the county location. (Notice, Ala. Dept. of Rev., 10/23/2024.)

Week Of 10.14.2024

Alabama Personal Income Tax—Alabama CHOOSE Act website now operational.

The Alabama Governor's Office announced that the Alabama Department of Revenue has launched a website (chooseact.alabama.gov) for the CHOOSE Act (Creating Hope and Opportunity for Our Students' Education Act of 2024). The CHOOSE Act makes refundable income tax credits available to eligible Alabama K-12 students that can be used to pay for school tuition, tutoring, educational therapies and other qualified education expenses at approved education service providers (ESPs) across the state (see State Tax Update, 03/11/2024). On the website, Alabama families and ESPs can obtain information about the CHOOSE Act program, including eligibility information, an online application, program FAQs, important deadlines, and parent and ESP guides. The family application process for the 2025-2026 school year will open on January 2, 2025, and close on April 7, 2025, with award notifications scheduled to be sent out on May 1, 2025. Interested ESPs can now begin applying online through the website. (Release, Office of the Alabama Governor, 10/09/2024.)

Week Of 10.07.2024

Alabama Property Tax—renewal month for new IRP accounts.

The Alabama Department of Revenue has announced that the month of June will be the default assigned renewal month for new International Registration Plan (IRP) accounts during the period November 1, 2024 thru October 31, 2025. Ad valorem tax must be collected for each IRP registered vehicle through the end of the renewal month assigned to the IRP account. (Memorandum 2024-005, Ala. Dept. Rev., 10/04/2024.)

Week Of 09.30.2024

Alabama Fuels & Minerals Taxes—IRP/IFTA requirements suspended to assist hurricane relief efforts.

The Commissioner of the Alabama Department of Revenue has announced that the Department will temporarily suspend the motor fuel exporter, importer, and transporter licensing requirements associated with the Alabama Terminal Excise Tax for exporters, importers, or transporters supporting disaster relief efforts by engaging in the export of motor fuel to areas in other states impacted by Hurricane Helene for which a state of emergency or disaster has been declared, or the import of motor fuel into areas in Alabama for which a state of emergency or disaster has been declared. The Department will also temporarily suspend the requirements associated with the International Registration Plan (IRP) and the International Fuel Tax Agreement (IFTA) for any motor vehicle engaged in interstate disaster relief efforts resulting from Hurricane Helene that is traveling through the State of Alabama as part of the disaster relief. The temporary suspension is effective for 30 days from the date of the Commissioner's order, i.e., until October 27, 2024. (Order of the Commissioner, Ala. Dept. Rev., 09/27/2024; Order of the Commissioner, Ala. Dept. Rev., 09/27/2024.)

Alabama Sales and Use Tax Rates—local tax changes.

The following changes will take effect on October 1, 2024: (1) The Town of Bon Air will levy a sales tax at the rate of 4% for general rate items and 2% for automotive vehicles, truck trailers, semi-trailers and house trailers. (2) The Alabama Department of Revenue will begin collecting the City of Scottsboro's sales, use, rental, and lodging taxes. (3) The Town of Goodwater will increase sales tax rates to: 4% for general rate items, 2% for farm machinery, 3% for manufacturing machinery, and 2% for automotive vehicles, truck trailers, semi-trailers and house trailers. The withdrawal fee for automotive vehicle dealers will increase to $100. (4) The Town of Bakerhill will reduce its sales and use tax rate for automotive vehicles, truck trailers, semi-trailers and house trailers to 1% from 4%. If sales of tangible personal property are made or delivered, or if purchases of tangible personal property are stored, used or consumed, outside the corporate limits of Goodwater or Bakerhill but within their police jurisdiction, the rate of tax is one-half of the stated rate. (Notice, Ala. Dept. Rev., 09/26/2024; Notice, Ala. Dept. Rev., 09/26/2024; Notice, Ala. Dept. Rev., 09/26/2024; Notice, Ala. Dept. Rev., 09/26/2024.)

Alabama Sales & Use Taxes— releases initial list of 2025 severe weather preparedness sales tax holiday participants.

The Alabama Department of Revenue has released an initial list of counties and municipalities that have notified the Department concerning their participation in the 2025 severe weather preparedness sales tax holiday, which is being held from February 21, 2025 to February 23, 2025. (Local Governments Participating in the 2025 Alabama Severe Weather Preparedness Tax Holiday, Alabama Department of Revenue, 09/27/2024.)

Alabama Sales & Use Taxes—change in administration of Birmingham, Dauphin Island taxes.

The City of Birmingham has notified the Alabama Department of Revenue of a change in administration for the collection of sales/use and any other city taxes, effective September 1, 2024. For the period ending September 30, 2024, which is due on or before October 20, 2024, City of Birmingham taxes will be administered by: City of Birmingham, Tax and License Division, Attn. Manager of Tax Collections/Tax and License Administrator. The Town of Dauphin Island has asked the Department to begin collecting the town's sales, use, rental, and lodging taxes, effective October 1, 2024. Consequently, the first Dauphin Island local tax return filed with the Department will be for the tax period ending October 31, 2024, which is due on or before November 20, 2024. (Notice, Ala. Dept. Rev., 09/25/2024; Notice, Ala. Dept. Rev., 09/25/2024.)

Alabama Sales & Use Taxes—local tax changes.

The following changes will take effect on October 1, 2024: (1) The Town of Bon Air will levy a sales tax at the rate of 4% for general rate items and 2% for automotive vehicles, truck trailers, semi-trailers and house trailers. (2) The Alabama Department of Revenue will begin collecting the City of Scottsboro's sales, use, rental, and lodging taxes. (3) The Town of Goodwater will increase sales tax rates to: 4% for general rate items, 2% for farm machinery, 3% for manufacturing machinery, and 2% for automotive vehicles, truck trailers, semi-trailers and house trailers. The withdrawal fee for automotive vehicle dealers will increase to $100. (4) The Town of Bakerhill will reduce its sales and use tax rate for automotive vehicles, truck trailers, semi-trailers and house trailers to 1% from 4%. If sales of tangible personal property are made or delivered, or if purchases of tangible personal property are stored, used or consumed, outside the corporate limits of Goodwater or Bakerhill but within their police jurisdiction, the rate of tax is one-half of the stated rate. (Notice, Ala. Dept. Rev., 09/26/2024; Notice, Ala. Dept. Rev., 09/26/2024; Notice, Ala. Dept. Rev., 09/26/2024; Notice, Ala. Dept. Rev., 09/26/2024.)

Alabama Taxpayers Affected by Hurricane Helene May Request Filing and Penalty Relief.

The Alabama Department of Revenue has announced that it will consider, on a case-by-case basis, tax filing and penalty relief for Alabama taxpayers who reside or have a business in federally declared disaster areas and are unable to timely file tax returns as a result of damage or disruptions caused by Hurricane Helene. (Alabama Tax Filing Relief May Be Available for Those Affected by Hurricane Helene, Ala. Dept. of Rev., 10/02/2024.)

Taxpayers in areas not specifically designated as disaster areas who encounter difficulty filing on time due to weather-related circumstances associated with Hurricane Helene may be eligible to request a waiver of late-filing and late-payment penalties after providing appropriate documentation to ALDOR.

Obtaining relief: To request relief, or any additional assistance, taxpayers must contact the appropriate Department division office: Individual Income Tax: (334) 353-0602; Corporate Income Tax: (334) 242-1200; Sales and Use Tax: (334) 242-1490; Pass-through Entities: (334) 242-1033; Business Privilege Tax: (334) 353-7923; Financial Institution Excise Tax: (334) 242-1200 and Withholding Tax: (334) 242-1300.

Alabama Sales and Use Tax Rates—local lodgings tax changes

Effective October 1, 2024, the Town of Magnolia Springs will levy a lodgings tax at the rate of 6% and the Town of Jackson's Gap will levy a lodgings tax at the rate of 5%. Lodgings offered to transients outside the corporate limits of these towns but within their police jurisdictions are subject to tax at one-half of the stated rates. Effective October 1, 2024, St. Clair County will increase its lodging tax as follows: St. Clair Co (7059), to 6% from 2%; and St. Clair Co CL Pell City (7759), to 5% from 1%. Magnolia Springs, Jackson's Gap and St. Clair County taxes may be remitted online through My Alabama Taxes (MAT). (Notice, Alabama Dept. Rev., 09/25/2024; Notice, Alabama Dept. Rev., 09/25/2024; Notice, Alabama Dept. Rev., 09/25/2024.)

Alabama Sales & Use Taxes—local lodgings tax changes

Effective October 1, 2024, the Town of Magnolia Springs will levy a lodgings tax at the rate of 6% and the Town of Jackson's Gap will levy a lodgings tax at the rate of 5%. Lodgings offered to transients outside the corporate limits of these towns but within their police jurisdictions are subject to tax at one-half of the stated rates. Effective October 1, 2024, St. Clair County will increase its lodging tax as follows: St. Clair Co (7059), to 6% from 2%; and St. Clair Co CL Pell City (7759), to 5% from 1%. Magnolia Springs, Jackson's Gap and St. Clair County taxes may be remitted online through My Alabama Taxes (MAT). (Notice, Alabama Dept. Rev., 09/25/2024; Notice, Alabama Dept. Rev., 09/25/2024; Notice, Alabama Dept. Rev., 09/25/2024.)