Hibou Odoo Suite Enterprise: State of Alabama: Filing State Income Taxes, W-2s, and 1099s

Purpose

The purpose of this documentation is to outline the processes and requirements associated with filing state income taxes as well as how to file W-2s and 1099s, if needed, in the state of Alabama.

State Income Tax Withholding

To determine the amount of state of Alabama income tax withholding, employees, on or before the commencement of employment, should complete an Alabama Form A4 - Employee's Withholding Tax Exemption Certificate

Employers are required to keep copies of completed state A-4 forms for their employees in their files. These forms serve as verification that state income taxes are being withheld according to the employee’s instructions and needs to be available for inspection if the state requests it. 

The Forms W-4 and A-4 are generally valid until the employee provides new versions. However, employees who claim exemption from withholding must renew the exemption annually by filing new Forms W-4 and A-4 by February 15th of each year.

FrequencyIncome Tax WithheldDueReport
MonthlyFor the first 2 months in each quarter, in which more than $1,000 is withheld, you will need to report using the schedule in the next column. The first 2 months in each quarter are:  Jan, Feb, April, May, July, Aug, Oct, and Nov.On or before the 15th of the month following the end of the month being filed.A-6 (Payments of $750 or more must be filed and paid electronically at My Alabama Taxes).
QuarterlyRegardless of the amount withheld, all employers must report for March, June, Sept, and Dec.The last day of the first month following the end of the quarters.A-1 (Payments of $750 or more must be filed and paid electronically at My Alabama Taxes).

Forms A-6 or A-1 should be mailed to:

    Alabama Department of Revenue
    Withholding Tax Returns
    P. O. Box 327483
    Montgomery, AL 36132-7483

State Income Tax Withholding Reporting & Deposits

Important!

Under no circumstances should tax for any period greater than one calendar month be reported on Form A-6.


Important!

In the state of Alabama, if you are filing 25 or more W-2s (and/or Forms 1099 only if Alabama income tax was withheld) OR filed electronically the previous tax year, you are required to file electronically. The below instructions assume you are filing electronically and so will not make any distinction as to the amount of W-2s and/or 1009s

If filing less than 25 Forms W-2 (and/or Forms 1099 only if Alabama income tax was withheld) OR you did NOT file electronically the previous tax year, you can prepare a paper Form A-3 (and send W-2 and 1099 forms with it).

The due date for filing wage and tax information is January 31.

W-2 and 1099 Forms 

In the state of Alabama, you will file Form A-3 alongside Forms W-2 (and/or Forms 1099 only if Alabama income tax was withheld) electronically, 

Filing the Form A-3 electronically is a two-step process:

Step 1: Submission of W-2 and/or 1099 Statements. Taxpayers can manually enter their wage and tax information or they can upload a file containing their information. Only text files are acceptable and the filename must have a .txt extension. Only 1099’s with Alabama income tax withheld should be included in the file.

  • My Alabama Taxes (MAT) allows filers to either enter wage and tax information manually or import a file. MAT is not limited to the number of statements that can be manually keyed.

  • To file through My Alabama Taxes, select the Return List for December and then click on File Now for Form A3 and Forms W2. On the next page click the Import Wage and Tax link and select the file to upload. or click on "Enter/Edit Wage and Tax Information" to manually enter the wage and tax information. All errors must be corrected before continuing to Step 2.

Step 2: Completion of the A-3 Annual Reconciliation. Upon successfully entering or uploading the W-2 and/or 1099 information, you must complete Form A-3 online. All fields on Form A-3 are required and must be entered on the form. Your information will not be received/processed until you have received a confirmation number.

Good to Know!

Form A-3 submitted separately from W-2 forms cannot be processed.

For more details, see Withholding Tax.