Drake Tax - AL - Privilege Tax Amount Due
Article #: 18349
Last Updated: December 05, 2024
Note This article comprises former KB articles 18050 and 18349. It is herein referred to as KB 18349.
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 $0 for 2024. Privilege tax is filed and paid for the upcoming tax year, so the forms are dated for the next tax year (2024) in the current-year software (Drake Tax 2023). Due to the updated law, any taxpayer that would have been subject to the previous $100 minimum no longer pays tax and does not have a filing requirement. In Drake Tax 2023:
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If the gross privilege tax calculated is $100 or less, the taxpayer neither owes tax nor files the return.
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If the gross privilege tax calculated is greater than $100, the taxpayer must pay the exact amount up to the maximum tax liability limit.
The calculated gross privilege tax must range from $1 - $100 to reduce the amount of privilege tax due to $0.
Per AL e-file specifications, returns that do not have a tax calculated cannot be filed electronically unless there is a refund due or “No Alabama Factor Presence Nexus” is marked on the privilege tax form.
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 Drake Tax 2022:
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If the gross Privilege Tax calculated is $100 or less, then the taxpayer will pay exactly $50.00 in lieu of the $100.00.
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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.