Alabama Payroll Licensing
Harbor Compliance provides payroll tax registration services in every state to help your company hire employees and process payroll on time.
In most states, the two payroll taxes are withholding and unemployment insurance (aka unemployment tax and unemployment compensation). Employers must register for the appropriate accounts in order to hire employees, to process payroll, and to file tax returns. Given the virtual, home-based, and temporary nature of employees, registrations often take place on short notice and in multiple states. Foreign qualification and registered agent are prerequisites in most states.
Employer Witholding Tax Licensure
This section applies to employers that are applying for a license in Alabama for the first time to withold taxes from payroll.
|Agency:||Alabama Department of Revenue|
To register for employer withholding tax in Alabama, you will need to follow these steps:
It is important to note that the process for registering as an employer and withholding taxes may vary depending on the specific circumstances of your business. If you have any questions or need assistance, please get in touch with us for more information.
There is no fee to register for employer withholding tax in Alabama. However, once registered as an employer, you will be responsible for withholding and remitting state and federal income taxes from your employees' paychecks, as well as paying unemployment insurance taxes and any other required taxes.
It is important to note that the process for registering as an employer and paying the required withholding taxes may vary depending on the specific circumstances of your business.
It takes 3 to 5 business days for the ADOR to process your application and issue your new account number(s).
In Alabama, employer withholding tax is governed by state and federal laws.
At the state level, the Alabama Department of Revenue (ADOR) is responsible for administering the state's tax laws, including those related to employer withholding tax. The ADOR has the authority to collect taxes from employers and to enforce tax laws, including by imposing penalties for failure to register as an employer and pay the required withholding taxes.
At the federal level, employer withholding tax is governed by the Internal Revenue Code (IRC). The IRC sets out the rules for withholding and remitting federal income taxes from employees' paychecks, as well as for paying unemployment insurance taxes and other required taxes. The IRS is responsible for enforcing the IRC and can impose penalties for failure to comply with the federal tax laws.
If you fail to register as an employer and pay the required withholding taxes in Alabama, you may be subject to penalties and fines. The specific penalties that you may face will depend on the specific circumstances of your case, such as the amount of taxes that you owe and whether you made a good faith effort to comply with the tax laws.
Some potential penalties that you may face for failing to register as an employer and pay the required withholding taxes in Alabama include:
It is important to note that these are just some of the potential penalties that you may face for failing to register as an employer and pay the required withholding taxes in Alabama. If you are facing these or any other penalties, you should consult with a tax professional or an attorney for advice on your specific situation.
The ADOR estimates it takes over 30 minutes to complete the online application.
Unemployment Tax Licensure
This section applies to employers that are applying for a license in Alabama for the first time for unemployment insurance.
|Agency:||Alabama Department of Labor|
Please note, per an announcement on the ADOL website, that they are becoming more strict with new hire noncompliance: "The Alabama Department of Labor has begun enforcement of the Employer New Hire Reporting Law. To avoid citations, please review your records and report all newly hired (not previously employed or previously employed but has returned to work after being separated for 60 consecutive days) or recalled employees within the last 12 months from the current date. Failure to report new hires in the future may result in the assessment of the $25.00 penalty per occurrence."