Disclaimer: This calculator gives you an estimate based on tax rates and details found online. These rates may change over time. For the most accurate and up-to-date information, please check the official IRS website and your state’s tax website. Always talk to a tax expert for advice about your personal tax situation.
How We Calculate the Result
We start by taking your total household income and then subtract certain deductions like your 401(k) and IRA contributions, as well as either your itemized deductions or the standard deduction for your filing status. Then, we reduce this by your personal exemptions ($1,500 per exemption in Alabama). This gives us your taxable income for Alabama state tax purposes.
Next, we apply Alabama’s state income tax rates, which are progressive. This means the first part of your taxable income is taxed at 2%, then the next portion at 4%, and any income above that at 5%, depending on your filing status.
Finally, we show you your estimated Alabama income tax amount and the effective tax rate — which is your tax as a percentage of your total income. We also let you know if you meet the federal tax filing income threshold based on your age and filing status.
About Alabama Income Tax
Alabama is a state with progressive income tax rates, meaning the tax rate increases as your income increases. The rates range from 2% to 5%, depending on your taxable income and filing status. For single filers and married filing separately, the tax is 2% on the first $500, 4% on the next $2,500, and 5% on income above $3,000. For married filing jointly, head of household, and surviving spouses, the brackets double, taxing 2% on the first $1,000, 4% on the next $5,000, and 5% on income above $6,000.
Alabama also allows deductions like standard or itemized deductions and personal exemptions, which reduce the amount of income that is taxable. These help lower your tax bill.
If your income is low, you may not owe any Alabama income tax. You also need to be aware of federal filing requirements, which depend on your age and filing status.
Frequently Asked Questions
What is the income tax rate in Alabama?
Alabama uses progressive tax rates from 2% to 5%. Lower income is taxed at 2%, mid-level income at 4%, and higher income at 5%. The exact brackets depend on your filing status, with married filers generally having higher bracket thresholds than singles.
When do singles start paying Alabama income tax?
Singles begin paying Alabama income tax when their taxable income exceeds $500. Income up to $500 is taxed at 2%, and taxes increase with higher income. Deductions and exemptions can reduce taxable income and possibly delay when tax is owed.
When do married filers start paying Alabama Income tax?
Married couples filing jointly start paying Alabama income tax when their taxable income exceeds $1,000. The first $1,000 is taxed at 2%, the next $5,000 at 4%, and income above $6,000 at 5%. Itemized deductions and exemptions lower taxable income, which can reduce or delay tax liability.