Alabama Tax Calculator 2025
Calculate your Alabama state income tax with our comprehensive 2025 calculator featuring progressive rates from 2% to 5%, standard deductions, and advanced tax planning tools for the Heart of Dixie.
Calculate Your Alabama State Tax
Enter your income information to calculate Alabama state income tax and explore tax optimization strategies.
Alabama Tax Brackets 2025
Alabama operates a progressive income tax system with rates ranging from 2% to 5%. The Heart of Dixie offers competitive rates with a relatively low tax burden compared to many southeastern states.
Single Filers
- 2% on income up to $500
- 4% on income from $501 to $3,000
- 5% on income over $3,000
Married Filing Jointly
- 2% on income up to $1,000
- 4% on income from $1,001 to $6,000
- 5% on income over $6,000
Head of Household
- 2% on income up to $500
- 4% on income from $501 to $3,000
- 5% on income over $3,000
Alabama Tax Benefits
Alabama offers several tax advantages that make it attractive for residents, retirees, and military personnel seeking a favorable tax environment in the southeastern United States.
- Low Tax Rates: Progressive rates from 2% to 5% with relatively high threshold for top bracket
- Standard Deductions: $2,500 for single filers, $7,500 for married filing jointly
- Personal Exemptions: $1,500 per person and dependent
- Military Benefits: Partial military pay exemption for active duty personnel
- Retirement Benefits: Some retirement income exclusions available
- Business-Friendly: Low corporate tax rates and business incentives
- Low Cost of Living: Combined with moderate taxes creates favorable overall tax burden
Alabama Residency Rules
Understanding Alabama residency is important for determining your tax obligations in the Heart of Dixie.
Full-Year Resident
You're considered an Alabama resident if your permanent home is in Alabama or you maintain your domicile in the state for more than 185 days of the tax year.
Part-Year Resident
If you moved to or from Alabama during the year, you may file as a part-year resident and pay tax only on income earned while an Alabama resident.
Non-Resident
Non-residents pay Alabama tax only on income sourced within Alabama, such as wages earned in Alabama or rental income from Alabama property.
Military Personnel
Alabama offers special provisions for military personnel, including partial exemptions for military pay and favorable treatment for spouses of military members.
Frequently Asked Questions
What are Alabama's tax rates for 2025?
Alabama has progressive tax rates of 2%, 4%, and 5%. The 5% top rate applies to income over $3,000 for single filers and over $6,000 for married filing jointly, making Alabama's structure reach the top rate relatively quickly.
Does Alabama tax retirement income?
Alabama provides some retirement income benefits, though not as extensive as some states. Certain retirement income may qualify for partial exemptions, particularly for military retirees and older taxpayers.
What is Alabama's standard deduction for 2025?
Alabama's standard deduction for 2025 is $2,500 for single filers, $7,500 for married filing jointly, $2,500 for married filing separately, and $4,700 for head of household filers.
How does Alabama compare to neighboring states?
Alabama's 5% top rate is competitive with neighboring states. Florida and Tennessee have no income tax, while Georgia has a 5.75% top rate. Alabama's moderate rates and low cost of living create an attractive overall tax environment.
Does Alabama offer military tax benefits?
Yes, Alabama provides partial military pay exemptions for active duty personnel and favorable treatment for military spouses. Military retirees may also qualify for certain retirement income exclusions.
When are Alabama state taxes due?
Alabama state income tax returns are due on April 15th, the same date as federal returns. Alabama also requires quarterly estimated tax payments for those who expect to owe $500 or more in tax.