Alabama Tax Calculators.
2025 income tax rates, brackets, and sales tax for Alabama. Free calculators with Alabama-specific defaults.Income Tax
Alabama uses a progressive income tax with 3 brackets ranging from 2% to 5%. The brackets are narrow, so most taxpayers reach the top rate quickly. Alabama also allows a deduction for federal income taxes paid.
| Taxable Income | Rate |
|---|---|
| $0 - $500 | 2.0% |
| $500 - $3,000 | 4.0% |
| Over $3,000 | 5.0% |
Sales Tax
Groceries are taxed at the full state rate. Prescription drugs are exempt.
Alabama's top rate of 5.0% is slightly above the national average of ~4.6%, but its deduction for federal taxes paid partially offsets this.
What is the income tax rate in Alabama?
Alabama has a progressive income tax with rates of 2%, 4%, and 5%. The top rate of 5% applies to income over $3,000 for single filers.
Does Alabama tax groceries?
Yes, Alabama taxes groceries at the full 4% state sales tax rate, though some cities add additional local taxes. This is one of the few states that fully taxes groceries.
Can I deduct federal taxes on my Alabama return?
Yes, Alabama is one of a few states that allows you to deduct your federal income tax liability from your state taxable income, which can significantly reduce your state tax bill.