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Alabama is a pro-business state, offering competitive tax incentives to help businesses thrive within the state. Tax abatements and incentives are available to qualifying businesses that are expanding or locating to Alabama. Additional information about Alabama tax rates and incentives can be found at the Alabama Department of Commerce website.

Alabama’s corporate income tax rate is 6.5% and is based on a company’s net taxable income in Alabama. In addition to deductions for qualifying pollution control equipment, companies in Alabama can deduct the full amount of federal income taxes apportioned to Alabama.

Other incentives include:

  • Net Operating Loss Carryforward – Includes a 15-year carryforward of net operating losses
  • Basic Skills Educational Tax Credit – A tax credit of 20% of the cost of qualifying employee education programs

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