Form a Business in Alabama

What makes Alabama different

• AL ABOLISHED the Annual Report requirement effective October 1, 2024. Alabama Act No. 2024-213 (HB 230), signed May 7, 2024 , no business entity (LLC, Corp, LP, LLP, etc.) files an Annual Report with the Alabama SOS anymore. Major recent change.…
• Business Privilege Tax (BPT) is still required at AL Department of Revenue: - Form BPT-IN (Initial) within 2.5 months of formation - Form CPT (C-Corp) or PPT (LLC/Partnership) annually thereafter - Rate: $0.25 to $1.75…
• Certificate of Formation (LLC/Corp): $200 at SOS. Same fee for both LLC and Corp.
• Nonprofit Corp formation: $100 at SOS.
• AL uses Probate Court historically old requirement was simultaneous filing with Judge of Probate in county of registered office. This was simplified. Now SOS-only filing is the standard path.
• Personal Income Tax: progressive 2-5% (top bracket starts ~$3K single filer. Effectively flat 5% for working professionals).
• Corporate Income Tax: 6.5% flat.
• Sales Tax 4% state base + local up to 7.5% = combined 9-11.5% (Birmingham 10%, Montgomery 10%).