18050: AL - Privilege Tax Amount Due (Drake22)

Alabama has changed the minimum tax due on the Alabama privilege tax forms. On AL Forms BPT-IN, PPT, and CPT the minimum tax has been reduced from $100 to $50 for 2023. Privilege tax is filed and paid for the upcoming tax year, so the forms are dated for the next tax year in the current year software (links below). Due to the updated law, any taxpayer that would have been subject to the previous $100 minimum now pays exactly $50. In Drake22: 

• If the gross Privilege Tax calculated is $100 or less, then the taxpayer will pay exactly $50.00 in lieu of the $100.00.
• If the gross Privilege Tax calculated is greater than $100, then the taxpayer will pay the exact amount up to the maximum tax liability limit.

For example, if the Gross Privilege Tax is from $51 to $100, the Privilege Tax Due is reduced to $50. In this example, the tax calculated at $88, however, since that is less than $100, the amount due is $50 instead: 

Per the Form PPT Instructions:

"Minimum Business Privilege Tax. Alabama Act 2022-252 amends Section 40-14(A)-22. For taxable year 2023, taxpayers who would be subject to the minimum tax due of one hundred dollars ($100) shall pay fifty dollars ($50)."

"Line 19. Privilege Tax Due – Enter the difference between line 17 and line 18, but not less than $50, the minimum amount of the tax. This amount is also entered on page 1 of Form PPT on line 9 (Privilege Tax Due) in the Computation of Amount Due or Refund Due area of page 1."

Per the Form BPT-IN Instructions: 

"Minimum Business Privilege Tax. Alabama Act 2022-252 amends Section 40-14(A)-22. For taxable year 2023, taxpayers who would be subject to the minimum tax due of one hundred dollars ($100) shall pay fifty dollars ($50)."

"Line 20. Privilege Tax Due. Multiply line 18 (Gross Tax Due) by line 19 (Ratio of Days Remaining in Taxable Year), but not less than $50, the minimum amount of the tax. This amount is also entered on page 1 of Form BPT-IN on line 14 (Privilege Tax Due).

 Per the Form CPT Instructions: 

"Minimum Business Privilege Tax. Alabama Act 2022-252 amends Section 40-14(A)-22. For taxable year 2023, taxpayers who would be subject to the minimum tax due of one hundred dollars ($100) shall pay fifty dollars ($50)."

"Line 20. Privilege Tax Due – Enter the difference between line 18 and 19, but not less than $50, the minimum amount of the tax. This amount is also entered on page 1 of Form CPT on line 9, in the Computation of Amount Due or Refund Due area of the page."