The
following information has been provided to assist in the preparation of
File Form 40 if any of the following apply:
The taxpayer:
1.
Is a full or part-year
2.
Has
3. Is filing as single and has gross income in excess of $4,000
4. Is filing as married filing joint and both spouses have gross income in excess of $10,500
5. Is a minor that has gross income in excess of the personal exemption plus the standard deduction based on the filing status
6.
Is a resident of
7.
Is a resident of
8. Is a survivor or representative of a deceased taxpayer
1. Resident:
An individual who:
- Who thinks of
- Whose center of financial, social, and
family life is
- Who intends to come back to
2. Part-Year Resident:
An individual who:
- Moved into
- Moved out of
3. Non-Resident:
An individual:
- Whose permanent home is outside of
An
individual shall be considered “Head of Family” if and only if such individual
is not married at the close of their tax year, is not a surviving spouse and
their qualifying dependent is not a foster child. If
Alabama law differs from Federal law treatment in the treatment of some expenses shown on Federal Schedule C and F. These adjustments can be made on Part I, Line 2 Worksheet.
The following expenses may need to be adjusted for Alabama purposes:
- Percentage Depletion Gas and Oil
- Cost Depletion Natural Resources Other than Gas and Oil
- Depreciation
- Targeted “Jobs Credit” (Payroll expense)
- Passive Activity Losses
- Office and Home Expense
- Federal Economic Stimulus Act of 2008 Bonus Depreciation
A penalty is applicable if any of the following apply:
The taxpayer:
1. Fails to file the required estimated tax return and pay the tax within the time allowed
2. Underestimated the required amount
Penalty:
The penalty rate is 6% per year of the underpayment of tax from the due date to the date of payment.
For
returns not filed by the due date,
For taxes not paid by the due date, the taxpayer is subject to a late payment penalty of 1% per month or fraction of a month that the tax remains unpaid up to a maximum of 25%.
Interest
is charged on any taxes not paid by the return due date even if an
date until the tax is paid in full at the same rate of interest currently charged by the Internal Revenue Service.
There are also penalties for filing a frivolous return,
underpayment due to negligence, underpayment due to fraud,
and for a substantial understatement of estimated tax.
File Form 40NR if:
1.
The taxpayer is not a resident of
2.
The taxpayer received taxable income from
3.
The taxpayer's gross income from
allowable prorated personal exemption amount
1. A resident is an individual who
- lives in
- has their permanent home in
- intends to return to
2. A part-year resident is an individual who
- moved into
country to maintain residence in
- moved out of
in another state or country
3. A nonresident is an individual who
- has their permanent home outside of
An
individual shall be considered “Head of Family” if and only if such individual
is not married at the close of their tax year, is not a surviving spouse and
their qualifying dependent is not a foster child. If
A penalty is applicable if any of the following apply:
The taxpayer:
1. Fails to file the required estimated tax return and pay the tax within the time allowed
2. Underestimated the required amount
Penalty:
The penalty rate is 6% per year of the underpayment of tax from the due date to the date of payment.
For
returns not filed by the due date,
For taxes not paid by the due date, the taxpayer is subject to a late payment penalty of 1% per month or fraction of a month that the tax remains unpaid up to a maximum of 25%.
Interest
is charged on any taxes not paid by the return due date even if an
date until the tax is paid in full at the same rate of interest currently charged by the Internal Revenue Service.
There are also penalties for filing a frivolous return,
underpayment due to negligence, underpayment due to fraud,
and for a substantial understatement of estimated tax.
File Form 40 Schedule A, B,CR & DC to report any of the following:
1. Itemized deductions
2. Interest income
3. Dividend income
4. Credit for taxes paid
5. Voluntary donation check-offs
Schedule A should be used to report itemized deductions for
an
FICA tax withheld on income by the taxpayer's employer may be deducted on Alabama Schedule A. Federal self-employment tax paid during the year may also be deducted.
Other taxes deductible on the Alabama Schedule A include
- Personal Property Taxes
- City, county and occupational tax as shown on Form W-2
- Federal gift taxes paid by the person making the gift and paying the tax
- Generation-Skipping Transfer taxes
State income taxes paid are not deductible as an itemized deduction.
Premiums paid for qualified long term care coverage may be deducted on the Alabama Schedule A. Qualified long-term care services include care for necessary diagnostic, preventive, therapeutic, and rehabilitative services and maintenance or personal care services which are required by a chronically ill individual in a qualified facility or services which are provided pursuant to a place of care prescribed by a licensed health care practitioner.
NOTE: Part-Year
residents of
the itemized deductions actually paid during the
period of
File Schedule B to report income from interest and dividends of $1,500 or more, when Form 40 is being filed.
Report any interest received or credited to an account from which a withdrawal could be made.
Interest income includes any of the following:
1. Interest on savings or other bank accounts
2. Interest on promissory notes
3. Interest on a mortgage
4. Interest on a corporate bond
5. Interest on a corporate debenture
6. Interest on state obligations other than the State of
NOTE: Interest income from obligations of the United States Government
and the State of
Report any dividends received. Include cash and values of the stock, property, or merchandise received as a dividend.
Dividend income includes any of the following:
1. Ordinary dividends
2. Capital gain distributions
3. Nontaxable distributions
File Schedule CR to report credit for tax paid to another
state. Residents of
You may elect to contribute all or a part of you income tax refund to one or more of the following funds:
Donations of all or part of your refund to the Alabama Senior Services Trust Fund will provide additional services to older Alabamians.
Contributions to this fund expand grant making for:
a. Arts in the Schools
b. Exhibitions
c. Performances
d. Festivals
e. Touring Programs
f. Literary Programs
g. Community Design
h. Folk Culture and more
Contributions
to this fund are used to help bring back bluebirds, eagles, ospreys, and many
other nongame wildlife species in
Contributions to this fund are used for community based
child abuse and neglect prevention programs across
Contributions to this fund are used to provide the most
affordable and efficient skilled nursing care for
Contributions to this fund are used to provide for Indian children.
Contributions to this fund are used to:
a. Reduce infant deaths
b. Health care for seriously ill children
c. Immunizations and children’s disease prevention
Contributions to this fund are used to provide education,
athletic, artistic, and special occasion opportunities to children in the
custody of the
Contributions to this fund are used by volunteers to advocate for good care and treatment of those affected.
Contributions to this fund are used to provide help weatherize homes for persons 60 years and older, families with children and disabled persons.
Contributions to this fund are used to provide cutting edge
clinical care to the people of
Contributions to this fund are used to provide for kids of all ethnic groups to explore space, the environment, family issues, agriculture, healthy lifestyle, and communications, while learning the values of leadership and citizenship.
Giving Life a Second Chance.
Contributions to this fund are used to provide for National Guard members during times of hardship because of non-funded needs. The fund will assist with needs for dependents left behind for those guardsmen killed in action or those who die in non-combat status while on active duty
Contributions to this fund will help the
File Form 40NR Schedule A, B, D & E to report any of the following:
1. Itemized deductions
2. Interest income
3. Dividend income
4. Income/Loss from Rent and Royalties
5. Income/Loss form Partnerships, Estates, Trusts, and S Corporations
File Schedule A(NR) to report itemized deductions for an
taxpayer did not itemize deductions on the federal
individual income tax return, he or she may still itemize deductions on the
NOTE: A nonresident
of
FICA tax withheld on income by the taxpayer's employer may be deducted on the Alabama Schedule A. Federal self-employment tax paid during the year may also be deducted.
Other taxes deductible on the Alabama Schedule A include
- Personal Property Taxes
- City, county and occupational tax as shown on Form W-2
- Federal gift taxes paid by the person making the gift and paying the tax
- Generation-Skipping Transfer taxes
State income taxes paid are not deductible as an itemized deduction.
Premiums paid for qualified long term care coverage may be deducted on the Alabama Schedule A. Qualified long-term care services include care for necessary diagnostic, preventive, therapeutic, and rehabilitative services and maintenance or personal care services which are required by a chronically ill individual in a qualified facility or services which are provided pursuant to a place of care prescribed by a licensed health care practitioner.
File Schedule B to report income from interest and dividends of $1,500 or more, when Form 40NR is being filed.
Report any interest received or credited to an account from which a withdrawal could be made.
Interest income includes any of the following:
1. Interest on savings or other bank accounts
2. Interest on promissory notes
3. Interest on a mortgage
4. Interest on a corporate bond
5. Interest on a corporate debenture
6. Interest on state obligations other than the State
of
NOTE: Interest income
from obligations of the
Government and
the State of
divisions is exempt is exempt from income tax.
Report any dividends received. Include cash and values of the stock, property, or merchandise received as a dividend.
Dividend income includes any of the following:
1. Ordinary dividends
2. Capital gain distributions
3. Non-taxable distributions
File Schedule D (NR) to report the sale or exchange of real estate, stocks, bonds and other assets, when filing Form 40NR.
The gain or profit from any sale, exchange or other
disposition by a nonresident of real or tangible property located in
The gain or (loss) realized from the disposition of property
located outside of
income from all sources in order to compute the ratio of
Schedule E (NR) is used to report income or (loss) from rents, royalties, partnerships, S corporations, estates and trusts, when Form 40NR is being filed.
Use
Form 40ES to pay
Estimated tax is only required from individuals whose income, other than wages, can reasonably be expected to be $3,500 or more. If the amount of estimated tax due is less than $100, no estimated tax is required to be filed.
Penalties:
Penalties are provided for underestimating the amount of tax OR for failure to pay estimated tax within the time allowed.
File
Form 40 ES to pay
File Form 2210AL if all of the following apply:
The taxpayer:
1.
Does not have at least 90% of his/her annual
2. Has an annual tax liability that exceeds $100
Penalty:
Underestimating the required amount of tax or failure to file estimated tax returns and pay the tax within the time allowed will result in an assessment of interest. The interest rate is 1% per month of the underpayment of tax from the due date to the date of payment.
File Schedule D to report gain or loss from sale of real estate, stocks, bonds, mutual funds, etc.
All sales for the entire year should be reported if the
taxpayer was a resident for the entire year. If the taxpayer was a resident of
Under
File Schedule E, Part I to report income or loss from rental real estate or royalties.
File Schedule E, Part II to report income or loss from partnerships, S corporations, estates, and trusts.
File Form 4952A to calculate the investment interest expense deduction allowed for the current year.
Use Form NOL-85 to determine the actual net operating loss (NOL) sustained in the loss year, that may be carried back or carried forward.
Before completing Form NOL-85, Form 40 or Form 40NR must be completed through the taxable income line for the loss year.
The taxpayer may make an irrevocable election to forfeit the carryback of a net operating loss deduction and instead carry the loss forward to the first available year following the
loss year. This election is made in Part III of Form NOL-85.
If the taxpayer elects to carry the loss back, attach Form NOL-85 to the loss year return without the signature in Part III. The NOL must be carried back to the earliest year preceding the loss year in which the NOL may be utilized.
See Form NOL-85A, Net Operating Loss Carryback or Carryforward to apply a NOL to the tax year in which the loss is being carried.
File Form NOL-85A to apply a net operating loss to the tax year in which the loss is being carried.
Before Form NOL-85A can be completed, Form NOL-85 must be completed to determine the amount of net operating loss that may be carried back or carried forward.
Attach Form NOL-85A to Form 40X, Amended Alabama Individual Income Tax Return for the earliest year available when claiming a carryback. To carry the loss forward, attach Form NOL-85A to the first available year following the loss year.
NOTE: Nonresidents
must complete Part III before completing Part II. This is necessary in order to
determine the Standard or Itemized Deduction, Federal Income Tax Deduction and
exemption amounts allowable after applying the net operating loss. If the
taxpayer is married and filing a separate
To comply with
Do not mail Form AL8453 to the Alabama Department of Revenue. The electronic return originator (ERO) must keep the original Form AL8453 and any required attachments for a period of three years from the due date of the return or the date the return is filed, whichever is later. EROs must make the original document available to the Alabama Department of Revenue upon request.
Attach the following items to Form AL8453:
- Forms W-2, W-2G, 1099-G, and 1099-R with
- Copy of the other state's tax return and proof of payment, if claiming a credit for taxes paid to other states.
The taxpayer's signature is required on Form AL8453. If any substantive changes are made to the electronic return after Form AL8453 has been signed by the taxpayer (but before it is transmitted), the taxpayer must sign a corrected Form AL8453.