What are the Alabama payroll tax registration requirements?

 If you’re planning to process payroll in Alabama or hire employees who live or work there, you must register as an employer with the state. This ensures you can properly withhold, report, and pay Alabama payroll taxes. Below is a detailed overview of Alabama payroll tax requirements to guide you through the process.

Alabama (AL) Registration for Income and Unemployment Taxes

The state of Alabama requires you to register with the following tax agencies to make Alabama state tax payments and filings:

• Alabama Department of Revenue(DOR): Register and get your Withholding Account Number to file and pay your SIT taxes.

• Alabama Department of Labor(DOL): Register and get your Unemployment Compensation(UC) Account Number to file and pay your SUI taxes.

 

Register for the Department of Revenue(DOR) 

Employers must open a general tax account to obtain a withholding tax account number.  Follow the steps given below to register with Alabama (DOR).

• Register via Online: 

Create a general tax account

• Register with the Alabama Department of Revenue

• In the ‘Businesses’ section, click Register a business or Obtain a New Tax Account Number

• Complete all the steps with the agency to create a general tax account.

After successfully opening your general tax account. Here’s how you must register to get your withholding tax account number. 

 

Register for a withholding tax account number

• Visit My Alabama Taxes help page for instructions on how to register for tax types.

• Navigate to the My Alabama Taxes(MAT) page

• In the ‘Businesses’ section, click Register a business or Obtain a New Tax Account Number

• Ensure to read the instructions given before you begin.

• You enter your company ID and select that you’re an existing taxpayer and complete the remaining prompts.

• You’ll receive your Withholding account number within 3-5 days. 

 

• Register via Mail: 

If you choose to register via mail, you’ll get your withholding tax account number only after several weeks.  

 

Number Issued: After successful completion of registration, you will receive an Alabama Withholding Tax Account Number. This number is used to file state withholding forms like Form A-6, Form A-1, W-2, and Form A-3.

 

Register for the Department of Labor(DOL)

To register with the Department of Labor (DOL), make sure your business is liable for SUI taxes. Here are the conditions to register with DOL

• Employer must be paid $1500 in wages during any calendar quarter.

• You must have atleast one employee working for any part of the week for 20 or more different weeks during a calendar year.

• Register via Online

• Visit the AL  Department of Labor(DOL)

• Make sure you have the following information to get started with registration.

  • FEIN

  • Date Alabama Operation Began

  • Date of FUTA liability

  • Quarterly wages paid in AL

  • Number of Employees 

  • Name, title, SSN

• Once registered, you’ll receive your Unemployment Compensation Account Number instantly.

• Number Issued:  After successful registration, you will receive an Unemployment Compensation (UC) Account Number to file and pay your SUI taxes. 

 

 

• Register for Local Taxes

Generally, Alabama has local taxes. If you owe taxes in any of the following states, you will need to register with the Alabama Avenu Insights/Revenue Discovery Systems (RDS)

• Attalla

• Beaverton

• Birmingham

• Fort Deposit

• Guin

• Haleyville

• Hamilton

• Leeds

• Macon (county)

• Midfield

• Mosses

• Notasulga

• Shorter

• Southside

• Sulligent

• Tarrant

• Tuskegee

 

• Register via Online:

• Visit the  Alabama Avenu Insights/Revenue Discovery Systems (RDS)

• Request an ‘Authority Account Number’ to register for local taxes.

Auburn tax account registration

If your business is located in Auburn, you must get your Auburn tax account number. Here’s how you want to register

• Download a “Business Registration Form” and fill it out

• Submit the form by mail

 

Birmingham Occupational Tax

Employees who work in Birmingham are subject to the Birmingham Occupational Tax. Businesses located in Birmingham are required to get a Birmingham tax account number. Here’s how you want to register 

• Register here for the Birmingham tax account number 

• Submit a request for obtaining an “Occupational Tax Account Number.”

 

Gadsden Customer Number

If your business is located in Gadsden, you’re required to get a Gadsden Customer Number.

• Register here for the Gadsden Customer Number.

• You’ll need to download the Business License Application and fill it out.

• Submit the application by mail to obtain the Gadsden tax account number.

 

State Withholding Certificate (Form A-4)

Employees must complete Form A-4 (Employee’s Withholding Tax Exemption Certificate) within 30 days of starting employment. This form lets employees claim allowances and determines the correct amount of Alabama income tax to withhold.

If an employee does not submit Form A-4, employers must withhold tax at zero allowances.

Exemption from withholding may be claimed if:

• The employee had no Alabama tax liability last year and expects none this year.

• The employee meets special criteria (e.g., military spouses, certain residents of states with reciprocal agreements).

Alabama Payroll Tax Rates for 2025

Minimum Wage Base for Alabama

Alabama is the state that does not have a state minimum wage base. Employers are required to follow the federal minimum wage.

 

Alabama State Unemployment Insurance (SUI)

SUI taxes are state-level payroll taxes that employers pay to fund unemployment benefits for eligible workers who lose their jobs through no fault of their own. Here are the SUI tax rates for Alabama:

 

Alabama Payroll Tax Payments

To pay your Withholding and unemployment taxes, you must follow the given methods:

Withholding tax payments

• Pay via Online: 

• Direct online payment via bank account: Visit the My Alabama Taxes portal to submit your Alabama withholding tax payment. 

• Credit or debit card payment: To make a credit card payment in My Alabama Taxes, click on ‘Make a Payment’, select the payment type, and click ‘Pay by Credit Card’.

• Pay via Mail: 

  • Check or money order:  Complete Form 40V and mail it to the address mentioned in the form.

Unemployment tax payments

• Pay via Online: Visit the My Alabama Taxes portal to submit your Alabama unemployment tax payment.

 

Alabama Payroll Tax Filings

Here are the tax forms to be filed with the Alabama Department of Revenue (DOR) and the Department of Labor(DOL).

Alabama Department of Revenue(DOR)

• Form A-6 (Monthly Withholding Tax Return): This form is used by employers with an average monthly withholding liability of $1000 or more.

How to file?

File via Online:

• Visit the My Alabama Taxes website

• Go to Withholding Tax → File a Return → select Form A-6

• Enter the total wages and taxes withheld for the month

• Submit the return and make your payment online.

File via mail:

• If you file by mail, complete Form A-6, attach payment, and mail to the AL DOR to the address listed on the form.

Deadline:  Form A-6 is due by the 15th of the following month.

Amendments:

To correct the errors on previously filed Form A-6, you must follow the instructions given below:

• Visit the My Alabama Taxes website

• Select the monthly period you are amending

• File an amended A-6 return with accurate details

• You’ll be notified of underpayment and overpayment details.

 

• Form A-1 (Quarterly Withholding Tax Return): This form is used by employers with an average monthly withholding liability is less than $1000.

How to file?

File via Online:

• Visit the My Alabama Taxes website

• Go to Withholding Tax → File a Return → select Form A-1

• Enter the quarterly wages and taxes withheld 

• Submit the return and make your payment online.

File via mail:

• If you file by mail, complete Form A-1, attach payment, and mail it to the AL DOR at the address listed on the form.

 

Deadline: Form A-1 is due by the last day of the month following the quarter.

 

Amendments

To correct the errors on previously filed Form A-1, you must follow the instructions given below: 

• Visit the My Alabama Taxes website

• Select the monthly period you are amending

• File an amended A-1 return with accurate details

• You’ll be notified of underpayment and overpayment details.

• Form A-3 (Annual Reconciliation of Withholding Tax): Form A-3 is used by Alabama employers to reconcile the total state income tax withheld from employees’ wages during the year with the total payments and withholding returns (Forms A-1 or A-6) previously filed.

File via Online:

• Visit the  My Alabama Taxes website

• Go to Withholding Tax → File a Return → select Form A-3

• Enter the total wages paid and taxes withheld for the year

• Upload the Form W-2 for all the employees

• Submit the return online

 

File via mail:

• If you file by mail, complete Form A-3, attach payment, and mail it to the AL DOR at the address listed on the form.

Deadline: The deadline for filing the annual Form A-3 is January 31.

Amendments 

• Download a blank Form A-3 from the Alabama Department of Revenue

• Mark it as “Amended” at the top of the form

• Provide the corrected annual withholding totals and attach corrected W-2s

• Mail the return to the ALDOR.  

 

• Form W-2 

Employers must file W-2 forms to report annual wages paid and Alabama income tax withheld for each employee. This ensures employees receive accurate records for filing their individual state and federal tax returns.

Alabama Department of Labor(DOL)

• Form AL UC-CR4 (Quarterly Contribution and wage report):  This form is used by employers in Alabama to report unemployment insurance (UI) contributions and employee wage details each quarter.  

How to file?

File via Online

• Visit the Alabama Department of Labor

• From the website, select Quarterly Contribution and Wage Report (Form UC-CR4).

• Ensure you have the following information to complete your form

  • Employer account details.

  • Total wages paid during the quarter.

  • Taxable wages subject to unemployment insurance

  • Employee wage detail (name, SSN, and wages per employee).

• Submit the form and pay your taxes.

Deadline: Form UC-CR4 is due by the last day of the month following the quarter.

 

Amendments
To correct the errors on Form UC-CR4, you must file an amended report. Log in to My Alabama taxes and select the quarter you want to amend and file a corrected UC-CR4 and submit to ALDOL.

 

New Hire Report

Employers in Alabama are required to file a report for newly hired or recalled employees with the Alabama Department of Labor (ALDOL). Make sure to report within seven days of of hire date.

To file your new hire report, visit the Alabama New Hire Reporting Center or mail your return to the 

Alabama New-Hire Reporting
P.O. Box 327630
Montgomery, AL 36132-7630

Fax: (800) 259-8011