Overview of Alabama Taxes: Alabama is a state with some of the lowest income and property taxes. The state sales tax of 4% is also low, but local rates can more than double what you pay at the statewide level.
Your 2025 Estimated State Income Tax:
Breakdown of Your Income Taxes
Your Annual Take-Home Pay
About This Calculator
Our income tax calculator calculates your federal, state and local taxes based on several key inputs: your household income, location, filing status and number of personal exemptions.
How Income Taxes Are Calculated
-
First, we calculate your adjusted gross income (AGI) by taking your total household income and reducing it by certain items such as contributions to your 401(k).
-
Next, from AGI we subtract exemptions and deductions (either itemized or standard) to get your taxable income. Exemptions can be claimed for each taxpayer.
-
Based on your filing status, your taxable income is then applied to the tax brackets to calculate your federal income taxes owed for the year.
-
Your location will determine whether you owe local and / or state taxes.
When Do We Update? - We check for any updates to the latest tax rates and regulations annually.
Customer Service - If you would like to leave any feedback, feel free to email info@smartasset.com.
Assumptions
Deductions
- "Other Pre-Tax Deductions" are not used to calculate state taxable income.
Credits
- The only federal credit automatically calculated is the Savers Credit, depending on your eligibility.
- We do not apply any refundable credits, like the Child Tax Credit or Earned Income Tax Credit (EITC).
- We do not apply state credits in our calculations.
Itemized Deductions
- If itemizing at the federal level, you may need to itemize at the state level too. Some states don't allow itemized deductions, which is accounted for in our calculations.
- When calculating the SALT deduction for itemized deductions, we use state and local taxes, and we assume your MAGI.
- We assume that there is no cap to itemized deductions, if a state allows them.
- We do not categorize itemized deductions (such as medical expenses or mortgage interest), which could be subject to specific caps per state.
Local Tax
- Depending on the state, we calculate local taxes at the city level or county level. We do not include local taxes on school districts, metro areas or combine county and city taxes.
- With the exception of NYC, Yonkers, and Portland/Multnomah County, we assume local taxes are a flat tax on either state taxable income or gross income.
Actual results may vary based on individual circumstances and changes in tax laws or IRS regulations. Estimates provided by this calculator do not guarantee income tax amounts or rates. Past performance is not indicative of future results.
SmartAsset.com does not provide legal, tax, accounting or financial advice (except for referring users to third-party advisers registered or chartered as fiduciaries ("Adviser(s)") with a regulatory body in the United States). Articles, opinions and tools are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual. Users should consult their accountant, tax advisor or legal professional to address their particular situation.
Find a high-yield deposit account that works for you
Taxes can really put a dent in your paycheck. But with an interest-bearing account, you can let your money work for you. Save more with these rates that beat the National Average*:
The National Average is based on the APY average for high-yield savings accounts with a minimum balance of $2,500, using data available from Bankrate.*
Taxes in Alabama
Alabama State Tax Quick Facts
- State income tax: 2% – 5%
- Local income tax: 0% – 2%
- Sales tax: 4% – 11.5%
- Property tax: 0.38% median effective rate
- Gas tax: 30 cents per gallon of regular gasoline
Taxes in the Yellowhammer State are by and large lower than in most other states. Alabama has the second-lowest effective property tax rate in the country after Hawaii, and its income tax rates range from just 2% to 5%, lower than most other states that have an income tax. However, rates could be higher depending on where in Alabama you live or work, as local governments can also collect occupational taxes ranging from 0% to 2%.
The statewide sales tax of 4% ranks as one of the lowest in the country, but local sales taxes bring the average combined sales tax in the state up to as much as 11.5%. The average combined sales tax rate in Alabama is 9.168%, which is the fifth-highest nationwide.
A financial advisor can help you understand how taxes fit into your overall financial goals. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Alabama Income Taxes
The state income tax in Alabama is similar to the federal income tax, with increasing rates based on income brackets. However, while the federal income tax has seven brackets, Alabama has just three, with the top rate of 5% applying to all taxable income over $3,000 (over $6,000 for joint filers).
Income Tax Brackets
| Rate | Single Filers | Married, Filing Jointly | Married, Filing Separately | Head of Household |
|---|---|---|---|---|
| 2.00% | $0 – $500 | $0 – $1,000 | $0 – $500 | $0 – $500 |
| 4.00% | $500 – $3,000 | $1,000 – $6,000 | $500 – $3,000 | $500 – $3,000 |
| 5.00% | $3,000+ | $6,000+ | $3,000+ | $3,000+ |
These rates do not apply to gross income, but to Alabama taxable income, which is gross income minus any applicable deductions and exemptions. Taxpayers who itemize deductions federally may also do so on their Alabama return, but they can claim the Alabama standard deduction instead (and vice versa).
The Alabama standard deduction varies depending on filing status and income. At a certain point, the deduction descends steadily for increasing income levels, until it reaches its minimum amount at either $15,000 or $30,000, as is reflected in the table below.
Standard Deduction Tables (Single Filers)
| Alabama AGI | Standard Deduction |
|---|---|
| $ 0 – $25,999 | $3,000 |
| $26,000 – $26,499 | $2,975 |
| $26,500 – $26,999 | $2,950 |
| $27,000 – $27,499 | $2,925 |
| $27,500 – $27,999 | $2,900 |
| $28,000 – $28,499 | $2,875 |
| $28,500 – $28,999 | $2,850 |
| $29,000 – $29,499 | $2,825 |
| $29,500 – $29,999 | $2,800 |
| $30,000 – $30,499 | $2,775 |
| $30,500 – $30,999 | $2,750 |
| $31,000 – $31,499 | $2,725 |
| $31,500 – $31,999 | $2,700 |
| $32,000 – $32,499 | $2,675 |
| $32,500 – $32,999 | $2,650 |
| $33,000 – $33,499 | $2,625 |
| $33,500 – $33,999 | $2,600 |
| $34,000 – $34,499 | $2,575 |
| $34,500 – $34,999 | $2,550 |
| $35,000 – $35,499 | $2,525 |
| $35,500 + | $2,500 |
Standard Deduction Tables (Married, Filing Jointly)
| Alabama AGI | Standard Deduction |
|---|---|
| $ 0 – $25,999 | $8,500 |
| $26,000 – $26,499 | $8,325 |
| $25,500 – $26,999 | $8,150 |
| $27,000 – $27,499 | $7,975 |
| $27,500 – $27,999 | $7,800 |
| $28,000 – $28,499 | $7,625 |
| $28,500 – $28,999 | $7,450 |
| $29,000 – $29,499 | $7,275 |
| $29,500 – $29,999 | $7,100 |
| $30,000 – $30,499 | $6,925 |
| $30,500 – $30,999 | $6,750 |
| $31,000 – $31,499 | $6,575 |
| $31,500 – $31,999 | $6,400 |
| $32,000 – $32,499 | $6,225 |
| $32,500 – $32,999 | $6,050 |
| $33,000 – $33,499 | $5,875 |
| $33,500 – $33,999 | $5,700 |
| $34,000 – $34,499 | $5,525 |
| $34,500 – $34,999 | $5,350 |
| $35,000 – $35,499 | $5,175 |
| $35,500 + | $5,000 |
Standard Deduction Tables (Married, Filing Separately)
| Alabama AGI | Standard Deduction |
|---|---|
| $ 0 – $12,999 | $4,250 |
| $13,000 – $13,249 | $4,162 |
| $13,250 – $13,499 | $4,074 |
| $13,500 – $13,749 | $3,986 |
| $13,750 – $13,999 | $3,898 |
| $14,000 – $14,249 | $3,810 |
| $14,250 – $14,499 | $3,722 |
| $14,500 – $14,749 | $3,634 |
| $14,750 – $14,999 | $3,546 |
| $15,000 – $15,249 | $3,458 |
| $15,250 – $15,499 | $3,370 |
| $15,500 – $15,749 | $3,282 |
| $15,750 – $15,999 | $3,194 |
| $16,000 – $16,249 | $3,106 |
| $16,250 – $16,499 | $3,018 |
| $16,500 – $16,749 | $2,930 |
| $16,750 – $16,999 | $2,842 |
| $17,000 – $17,249 | $2,754 |
| $17,250 – $17,499 | $2,666 |
| $17,500 – $17,749 | $2,578 |
| $17,750 + | $2,500 |
Standard Deduction Tables (Head of Household)
| Alabama AGI | Standard Deduction |
|---|---|
| $ 0 – $25,999 | $5,200 |
| $26,000 – $26,499 | $5,065 |
| $26,500 – $26,999 | $4,930 |
| $27,000 – $27,499 | $4,795 |
| $27,500 – $27,999 | $4,660 |
| $28,000 – $28,499 | $4,525 |
| $28,500 – $28,999 | $4,390 |
| $29,000 – $29,499 | $4,255 |
| $29,500 – $29,999 | $4,120 |
| $30,000 – $30,499 | $3,985 |
| $30,500 – $30,999 | $3,850 |
| $31,000 – $31,499 | $3,715 |
| $31,500 – $31,999 | $3,580 |
| $32,000 – $32,499 | $3,445 |
| $32,500 – $32,999 | $3,310 |
| $33,000 – $33,499 | $3,175 |
| $33,500 – $33,999 | $3,040 |
| $34,000 – $34,499 | $2,905 |
| $34,500 – $34,999 | $2,770 |
| $35,000 – $35,499 | $2,635 |
| $35,500 + | $2,500 |
Alabamans in certain cities must also pay municipal occupational taxes. Unlike Alabama state income taxes, municipal occupational taxes apply to gross wages (as opposed to taxable income), and are typically withheld from workers’ paychecks. The table below shows the rates for the cities in Alabama with an occupational tax.
Occupational Tax Rates
| City | Occupational Tax Rate |
|---|---|
| Attalla | 2.00% |
| Auburn | 1.00% |
| Bear Creek | 1.00% |
| Bessemer | 1.00% |
| Birmingham | 1.00% |
| Brilliant | 1.00% |
| Fairfield | 1.00% |
| Gadsden | 2.00% |
| Glencoe | 2.00% |
| Goodwater | 0.75% |
| Guin | 1.00% |
| Hacklebug | 1.00% |
| Haleyville | 1.00% |
| Hamilton | 1.00% |
| Leeds | 1.00% |
| Lynn | 1.00% |
| Midfield | 1.00% |
| Mosses | 1.00% |
| Opelika | 1.50% |
| Rainbow City | 2.00% |
| Red Bay | 0.50% |
| Shorter | 1.00% |
| Southside | 2.00% |
| Sulligent | 1.00% |
| Tuskegee | 2.00% |
Alabama Sales Tax
Most goods sold in Alabama will be subject to both state and local sales taxes. The state sales tax rate is 4%. Additional taxes are then levied at the local level. The table below shows the total rates for all of Alabama’s counties.
Sales Tax Rates (Updated December 2025)
| County | Maximum Sales Tax Rate in County |
|---|---|
| Autauga County | 10% |
| Baldwin County | 11% |
| Barbour County | 9.5% |
| Bibb County | 10% |
| Blount County | 12% |
| Bullock County | 10% |
| Butler County | 10% |
| Calhoun County | 10% |
| Chambers County | 10% |
| Cherokee County | 10% |
| Chilton County | 11% |
| Choctaw County | 10% |
| Clarke County | 10% |
| Clay County | 9.5% |
| Cleburne County | 9% |
| Coffee County | 10% |
| Colbert County | 10% |
| Conecuh County | 10% |
| Coosa County | 10% |
| Covington County | 10% |
| Crenshaw County | 10% |
| Cullman County | 10% |
| Dale County | 10% |
| Dallas County | 10% |
| Dekalb County | 11.5% |
| Elmore County | 10.5% |
| Escambia County | 11% |
| Etowah County | 12% |
| Fayette County | 9.5% |
| Franklin County | 10% |
| Geneva County | 9.5% |
| Greene County | 10% |
| Hale County | 10% |
| Henry County | 10% |
| Houston County | 10% |
| Jackson County | 9% |
| Jefferson County | 10% |
| Lamar County | 9.5% |
| Lauderdale County | 9.5% |
| Lawrence County | 10% |
| Lee County | 10% |
| Limestone County | 10.5% |
| Lowndes County | 10.5% |
| Macon County | 11.5% |
| Madison County | 10.5% |
| Marengo County | 10% |
| Marion County | 11% |
| Marshall County | 12.5% |
| Mobile County | 10% |
| Monroe County | 10% |
| Montgomery County | 10% |
| Morgan County | 9% |
| Perry County | 10% |
| Pickens County | 10% |
| Pike County | 10% |
| Randolph County | 10% |
| Russell County | 9.75% |
| Shelby County | 12% |
| St Clair County | 10% |
| Sumter County | 11% |
| Talladega County | 11% |
| Tallapoosa County | 10% |
| Tuscaloosa County | 10% |
| Walker County | 10% |
| Washington County | 10% |
| Wilcox County | 11% |
| Winston County | 10% |
Among the types of products that are subject to the rates above are clothing, furniture, electronics and automobiles. Food is also taxable in Alabama at the full sales tax rate since there aren’t any food tax rebates or relief.
Alabama Property Tax
Regardless of how you measure it, Alabama’s property taxes are the second-lowest in the nation. To begin with, Alabama homeowners pay an median property tax bill of just $890 every year, the second-lowest annual median of any state. When measuring effective property tax rates (payments as a percentage of home value), Alabama also ranks second-lowest with a rate of 0.38%. Hawaii, where home values are nearly quadruple those in Alabama, ranks first.
If such low property taxes make you want to call Alabama home sweet home, check out our mortgage guide for the most important information about getting a mortgage in Alabama. Also check it out if you’re looking to refinance a property in the Yellowhammer State.
Alabama Capital Gains Tax
Capital gains are taxed as normal income in Alabama, and thus they are subject to the top income tax rate of 5%. City occupational taxes do not apply to capital gains, however, since they are not wages.
Alabama Tobacco Tax
Cigarettes are taxed at a rate of 68 cents per pack in Alabama.