Form 40 Booklet  Long Return  Residents and Part-Year Residents  Forms and Instructions revenue.alabama.gov 2024 myalabamataxes.alabama.gov

Index

Address Change … 17 Addresses of Taxpayer Service Centers … 3 Adoption Expenses … 16 Alabama Election Campaign Fund … 11 Alimony or Separate Maintenance Amount paid … 16 Amount received … 12 Amended Return … 18 Amount You Owe … 12 Annuities … 14 Armed Forces, Members of … 5

Business Income or (Loss) (Federal Schedule C and C-EZ) … 13 Business Use of Home … 21

Casualty and Theft Losses … 20 Consumer Use Tax … 10 Contributions to Charity … 20 Corresponding With Alabama Department of Revenue … 12 and 18

Death of Taxpayer … 18 Dependents … 8 and 10 Direct Deposit … 17 Dividend Income … 8 and 21 Domicile … 4 Donation of Refunds … 12 and 22

Educational Expenses … 21 Educational IRA … 13 Employee Business Expenses … 21 Estates and Trusts … 24 Estimated Tax … 11 and 18 Extension of Time to File … 18

Farm Income and Expenses … 15 Federal Tax Deduction … 8 and 31 Figuring Your Income Tax … 10, 25-30 Filing Requirements — When To File … 5 Which Form To File … 5 Who Must File … 5 Filing Status … 6 First-Time and Second Chance Home Buyer Savings Account ... 16 Forms, How To Get … 33

Gains … 13 and 23 General Information … 17

Head of Family … 6

Income (Examples) — You Must Report … 7 You Do Not Report … 7 Income Tax Withheld (Alabama) … 8 and 11 Income Tax Deduction (Federal) … 8 and 31 Interest Income … 8 and 21 Interest — Late Payment of Tax … 17 Interest — Penalty on Early Withdrawal of Savings … 16 Individual Retirement Arrangement (IRA) … 13, 14 and 15 Itemized Deductions … 8, 18-21

Keogh Plan — Deduction for … 14 and 15

Long Term Care … 21 Losses … 13 and 23

Married Persons — Filing Joint or Separate Return … 6 Medical and Dental Expenses … 19 Military Personnel — Residents of Alabama … 5 Nonresidents of Alabama … 5 Moving Expenses … 16 Miscellaneous Itemized Deductions … 20 and 21 Mutual Funds … 23

Name and Address … 6 Nonresidents of Alabama — Which Form To File … 5 Who Must File … 5

Other Income … 8 and 12

Part-year residents … 5 Partnerships … 23 Payments — Check/Money Order … 12 Credit Card… 12 ACH Debit (E-Check) … 12 Penalty — Criminal Liability … 17 Late Filing … 17 Late Payment of Tax … 17 Other Penalties … 17 Pensions … 14 and 15 Personal Exemption … 6 and 8 Preparer, Tax Return … 12

Records — How Long To Keep … 18 Refund Status… 4 Refund, When Should I Receive? … 4 Rents and Royalties … 23 Requesting a Copy of Your Tax Return … 18 Rollover Distributions … 14 Roth IRA … 13 Rounding Off to Whole Dollars … 7

Salaries … 7 Schedules A, B, CR, DC, D, and E Instructions… 18-24 SEP … 13, 14, and 16 Setoff Debt Collection … 4 and 18 Sign Your Return … 12 Single Person … 6 Social Security Number … 6 Standard Deduction … 8 and 9 Steps For Preparing Your Return … 6 Students and Dependents … 5

Tax Assistance for Taxpayers … 3 Tax Tables … 25-30

Wages … 7 Where To File Form 40 … 12 W T S R P O N M L K I H G F E D C B A Page 2

What’s New For 2024 Identity Quiz – If you happen to receive a notice to complete an ID Confirmation Quiz, it is not because you are suspected of ID theft. The purpose of the quiz is to pro­ tect your identity as the filer and prevent loss of taxpayer dollars to thieves. Credits – Certain tax credits are now required to be pre-approved through My Ala­ bama Taxes (MAT) at www.myalabamataxes.alabama.gov. Please see the credit in­ structions in this booklet and Schedule OC instructions for more information. Refund Check-offs – Act 2023-327 Effective January 1, 2024, allows for an in­ come tax refund donation to the State Parks Division of the Department of Conserva­ tion and Natural Resources, the Department of Mental Health, or the Alabama Medicaid Agency. See Schedule DC for more information. Volunteer First Responder Mileage Tax Credit – Act 2023-510 Effective Jan 1,2024, provides for an income tax credit to reimburse volunteer first responders for use of their private vehicle when responding to a fire, emergency, or rescue call. See Schedule OC for more information. Preceptor Tax Incentive Program – Act 2023-519 Effective January 1, 2024, es­ tablishes the Preceptor Tax Incentive Program to provide an income tax credit to pre­ ceptors who train in a rural area in Alabama in a clinical preceptorship in certain programs. See Schedule OC for more information. Negative numbers – Please enter all negative numbers with negative signs (-). Do not use parenthesis ( ).

★ ★ ★ ★ ★ ★ ★ ★ ★ Shoals Tuscaloosa Jefferson/ Shelby Montgomery Mobile Huntsville Gadsden Auburn/Opelika Dothan Page 3 Physical Addresses of Taxpayer Service Centers Alabama income tax assistance may be obtained by calling or visiting any of the Alabama Department of Revenue Taxpayer Service Centers listed below. Additional forms and instructions may also be obtained from these centers.  Auburn/Opelika Taxpayer Service Center 1800 Samford Trace Court, Suite 100 Auburn, AL 36830 Phone – (334) 887-9549  Dothan Taxpayer Service Center 121 Adris Place Dothan, AL 36303 Phone – (334) 793-5803  Gadsden Taxpayer Service Center 701 Forrest Avenue Gadsden, AL 35901 Phone – (256) 547-0554  Huntsville Taxpayer Service Center 4920 Corporate Drive, Suite H Huntsville, AL 35805 Phone – (256) 837-2319  Jefferson/Shelby Taxpayer Service Center 2020 Valleydale Road, Suite 208 Hoover, AL 35244 Phone – (205) 733-2740  Mobile Taxpayer Service Center 851 E. I-65 Service Road South, Bel Air Tower, Suite 100 Mobile, AL 36606 Phone – (251) 344-4737  Montgomery Taxpayer Service Center 2545 Taylor Road Montgomery, AL 36117 Phone – (334) 242-2677  Shoals Taxpayer Service Center 201 South Court Street, Suite 200 Florence, AL 35630 Phone – (256) 383-4631  Tuscaloosa Taxpayer Service Center 1434 22nd Avenue Tuscaloosa, AL 35401 Phone – (205) 759-2571

When Should I Expect My Refund? Wait At Least 90 Days For Your Refund If you do not receive your refund within 90 days of mailing your return, go to www.revenue.alabama.gov, then click on “Where’s My Refund,” or complete Form IT:489. Form IT:489 may be obtained from the Depart­ ment’s website under the Forms link or from any of our Alabama Taxpayer Service Centers listed on page 3 of this booklet. If you call about your refund, have a copy of your return with you or the Department may be unable to assist you. Each year the Ala bama Depart ment of Rev e nue re­ ceives over 1.8 million income tax re turns. Of this num­ ber, over 1 million taxpayers receive refunds. The Depart ment makes every effort to process your refund as quickly as possible, and there are several things you, the taxpayer, can do to help us accomplish this. The date you file your return and how you file deter­ mines when you can expect your refund. For example, electronically filed returns are received and processed significantly faster than returns that are mailed to the De­ partment of Revenue. Also, if you mail in an error-free re­ turn in January or February, you can expect to receive your refund sooner than if you wait until March or April to file. Returns filed this close to the deadline may require 90 days to process. Common Mistakes Which Delay Refunds Incorrect Name. Your refund will be issued in the name(s) appearing on your return. If your name is illeg­ ible or misspelled, your refund may be issued in the wrong name. Incorrect Address. Last year the U.S. Postal Serv­ ice was unable to deliver thousands of refunds due to incorrect addresses, or because the taxpayer moved and failed to leave a forwarding address. Incorrect Social Security Number. Last year ap­ proximately 80,000 returns were received with missing or incorrect social security numbers. Your social security number is very important; it is used for identification of your file. Please compare the number on your return with the number on your social security card. Show in the blocks provided the social security num­ bers in the same order as the first names. For example, the social security number of the first name listed should be entered in the box headed “Your social security num­ ber.” The social security number of the second name should be entered in the box headed “Spouse’s social security number.” If separate returns are filed, the person filing the return should enter his or her social security number in the box headed “Your social security num­ ber,” and enter the spouse’s social security number on line 3. It is very important that the social security num­ bers be listed in this order so your refund will be issued in the correct name. Legibility. On many returns, the name, address, or social security number is not readable. If this happens, the wrong information may be recorded, and your refund check may be delayed. Make sure that the information you enter on the return is readable. Missing Withholding Statement (W-2). Make cer­ tain the “State Copy” of all forms W-2 wage and tax statements are included, W-2s are frequently missing. The Department will consider the return incomplete if all required information is not included. Incorrect Computation. Many returns must be cor­ rected each year by the Department due to simple math errors. Before mailing your return, double check the ad­ dition and subtraction to make sure the math is correct. This is a good idea even if someone else prepares your return. Misdirected Mailing. Each year thousands of re­ turns are mailed to the Internal Revenue Service instead of the Alabama Department of Revenue. Filing More Than One Return. File only one Form 40, 40A, 40EZ, 40NR or electronic return for each tax year. If it is necessary to amend your original return, you must file a completed return with the “Amended Return” box checked. The amended return will be processed after your original return has been processed. Filing Copies. A copy of a return is not acceptable unless it has the taxpayer(s) original signature(s). Missing Signatures. Thousands of unsigned re­ turns are received each year by the Department. Before we can process them, these returns must be returned to the taxpayers for signatures. If a joint return is filed, both spouses must sign the return. Other Reasons For Refund Delays You Have Not Paid All Taxes Due From a Previ­ ous Year. If you owe tax for a prior year, your refund will be applied to pay that deficiency. Any amount remaining will be refunded to you. This will generally delay your re­ fund 12 weeks or more. Setoff Debt Collection. If the Alabama Department of Human Resources, the Alabama Department of Labor, the Administrative Office of Courts, the Alabama Medicaid Agency, Alabama League of Municipalities, or Association of County Commissions of Alabama has no­ tified the Alabama Department of Revenue that your ac­ count is delinquent on a debt repayment, any public assistance program (including the Child Support Act of 1979, Chapter 10, Title 38), any Medicaid assistance program, or Local Government Entity your refund will be applied to that debt. Note: See Setoff Debt Collection on page 18 for further information. Federal Refund Offset Program. Your 2024 federal or state refund will be taken to satisfy any outstanding li­ abilities owed to the State of Alabama or to the Internal Revenue Service.

SECTION Filing 1 Information

First, be certain you need to file a tax return. Your marital status, filing status, and gross income determine whether you have to file a tax return. Gross income usu­ ally means money, goods, and property you received on which you must pay tax. It does not include nontaxable benefits. See page 7 of the instructions to find out which types of income you should include. Other Filing Requirements Refunds. Even if your gross income was less than the amounts shown, you must file a return to get a refund if Alabama income tax was withheld from any amounts paid to you. Domicile. Individuals who are domiciled in (or resi­ dents of) Alabama are subject to tax on their entire in­ come whether earned within or without Alabama. This is true regardless of their physical presence within Ala­ bama at any time during the taxable year. Domicile is where one lives, has a permanent home, and has the in­ tention of returning when absent. Domicile may be by birth, choice, or operation of law. Each person has one and only one domicile which, once established, contin­ ues until a new one is established coupled with the aban­ donment of the old. Burden of proof regarding change of domicile is on the taxpayer even though he/she owns no property, earns no income, and has no place of abode in Alabama. If an Alabama resident accepts employment in a for­ eign country for a definite or indefinite period of time with the intent of returning to the United States, the individual remains an Alabama resident and all income, wherever earned, is subject to Alabama income tax. This is true even if the taxpayer leaves no property in Alabama. If a citizen of a foreign country comes to Alabama to work (no matter how long he stays), buys a home, se­ cures an Alabama driver’s license, does not intend to apply for U.S. Citizenship, and intends to ultimately re­ How To Use This Instruction Booklet The instructions for Form 40 are divided into five main sections.  Section 1 contains information on who must file, how to choose the correct form, and when to file a return.  Section 2 contains useful steps to help you prepare your return.  Section 3 contains specific instructions for most of the lines on your return.  Section 4 contains general information about such items as amending your tax return, how long to keep records, and filing a return for a de­ ceased person.  Section 5 contains instructions for complet­ ing Schedule A for those taxpayers itemizing their deductions. Also included are instructions for Schedules B, CR, DC, D, and E. If you follow the steps in Section 2 and the spe­ cific instructions in Section 3, you should be able to fill in your return quickly and accurately. Page 4 Refund Status To check the status of your current year refund, go to our Website at www.revenue.alabama.gov, then click on “Where’s My Refund,” or call our 24-hour toll-free Refund Hotline at 1-855-894-7391.

turn to the country of origin, the individual will be con­ sidered to have established domicile in Alabama. In other words, a foreign citizen domiciled in Alabama is li­ able for Alabama income tax on income earned from all sources. Military Personnel (Residents). Military personnel, whose legal residence is Alabama, are subject to Ala­ bama income tax on all income regardless of the source or where earned unless specifically exempt by Alabama law. Military personnel (Army, Navy, Marine, Air Force, Merchant Marine, and Coast Guard) who were residents of Alabama upon entering military service remain resi­ dents of Alabama for income tax purposes, regardless of the period of absence or actual place of residence, until proof as to change of home of record has been made. The burden of proof is on the taxpayer though he owns no property, earns no income, or has no place of abode in Alabama. Under the provisions of the Soldiers’ and Sailors’ Civil Relief Act, military personnel are not deemed to have lost their permanent residence in any state solely because they are absent in compliance with military orders. In addition, persons are not deemed to have acquired permanent residence in another state when they are required to be absent from their home state by virtue of military orders. If the husband and wife are both in military service, each could be a resident of a different state under the Soldiers’ and Sailors’ Civil Re­ lief Act. A spouse not in military service has the same domicile as the military spouse unless proven otherwise. Military Personnel (Nonresidents). Nonresi dent military personnel merely having a duty station within Alabama (whose legal residence is not Alabama) are not required to file an Alabama income tax return unless they have earned income from Alabama sources other than military pay. If they have earned income in Alabama other than military pay, they are required to file Alabama Form 40NR. A married nonresident military person with income earned in Alabama may file either a separate re­ turn claiming himself or herself only, or a joint return claiming the total allowable personal exemption. The “Military Spouses Residency Relief Act” (Public Law 111- 97) states that the income for services performed by the spouse of a service member shall not be deemed to be income for services performed or from sources within a tax jurisdiction of the United States if the spouse is not a resident of the jurisdiction in which the income is earned because the spouse is in the jurisdiction solely to be with the service member serving in compliance with military orders. Dependent’s and Student’s Income. Dependents who are residents of Alabama must file a return if they meet the requirements under You Must File A Return If… on this page. A student’s income is fully taxable to the same extent as other individuals who are required to file a return. The dependent or student can claim a per­ sonal exemption of $1,500, and his or her parents may claim a dependent exemption if they provided more than 50% of his or her total support. See Dependent Ex­ emption on page 8. When To File You should file as soon as you can after January 1, 2025, but no later than the due date of the federal re­ turn. If you file late, you will have to pay penalties and in­ terest. (See Penalties and Interest on page 17.) If you know you cannot file your return by the due date, you do not need to file for an extension. You will automatically be granted an extension until October 15, 2025. If you anticipate that you will owe additional tax on your return, you should submit your payment with a pay­ ment voucher (Form 40V) with the box “Automatic Ex­ tension Payment” checked by the due date of the federal return. Except in cases where taxpayers are abroad, no ex­ tension will be granted for more than 6 months. An extension means only that you will not be as­ sessed a penalty for filing your return after the due date. Interest on the additional tax due from the due date of the return and any penalties will be assessed if applicable to your return. Original returns must be filed within two years of the date the taxes are paid to be eligible for a refund. Crim­ inal Liability could result from a continued failure to file returns. (Refer to “Criminal Liability” on Page 17.) Which Form To File You MAY Use Form 40A If You Meet ALL The Following Conditions:  You were a resident of Alabama for the entire year,  You do not itemize deductions,  You do not claim any adjustments to income, such as an IRA deduction, alimony paid, Federal income tax paid for a prior year, etc.,  You do not have income from sources other than salaries and wages except for interest and dividend in­ come which cannot exceed $1,500,  You are not claiming income or loss from Sched­ ules C, D, E, or F, and  You are not claiming credit for taxes paid to an­ other state. You MUST Use Form 40 If:  You were a full or part-year resident of Alabama and do not meet ALL of the requirements to file Form 40A, and  You are itemizing deductions. Part-Year Residents Part-year residents of Alabama should only report in­ come earned while a resident of Alabama. Itemized de­ ductions must be prorated to reflect only those expenses incurred while a resident of Alabama. Federal Tax Lia­ bility must be prorated by applying a percentage of Ala­ bama adjusted gross income to Federal adjusted gross income in order to calculate the amount deductible on line 12 of Form 40. Part-year residents are allowed to deduct the full standard deduction, personal, and de­ pendent exemptions. You MUST Use Form 40NR If:  You are not a resident of Alabama and you re­ ceived taxable income from Alabama sources or for per­ forming services within Alabama and your gross income from Alabama source exceeds the allowable prorated personal exemption, or filing Married Filing Joint under the “Military Spouses Residency Relief Act.” Nonresi­ dents must prorate the personal exemption. If your Ala­ bama gross income exceeds the prorated amount, a return must be filed. You MUST Use Both Form 40 and Form 40NR If:  You had sufficient income to require the filing of a part-year return and also had income from Alabama sources while a nonresident during the same tax year. In this case, both the total personal exemption and the de­ pendent exemption must be claimed on the part-year resident return. No exemption can be claimed on the nonresident return. The part year resident return should include only income and deductions during the period of residency, and the nonresident return should include only income and deductions during the period of non ­ residency. Page 5 You Must File A Return If… You were a: and your marital status at the end of 2024 was: and your filing status is: and your gross income was at least: Single (including divorced and legally separated) Single $ 4,500 Full Year Head of family $ 8,200 Resident Married and living with your spouse at the end Married, joint return $11,500 of 2024 (or on the date your spouse died) Married, separate return $ 5,750 Single (including divorced and legally separated) Single $ 4,500 (while an Alabama resident) Part Year Head of family $ 8,200 (while an Alabama resident) Resident Married and living with your spouse at the end Married, joint return $11,500 (while an Alabama resident) of 2024 (or on the date your spouse died) Married, separate return $ 5,750 (while an Alabama resident) Single (including divorced and legally separated) Single or head of family Over the allowable prorated exemption: Nonresident Married and living with your spouse at the end Married, joint return

of 2024 (or on the date your spouse died) Married, separate return

SECTION Steps for Preparing 2 Your Return

By following these four useful steps, and reading the specific instructions, you should be able to prepare your return quickly and accurately. Step 1 Collect all your necessary records. Income Records. These include any Forms W-2, W-2G, and 1099 that you have. If you do not receive a Form W-2 by February 1, or if the one you receive is in­ correct, please contact your employer as soon as pos­ sible. Only your employer can give you a Form W-2, and only he or she can correct it. If you have someone prepare your return for you, make sure that person has all your income and expense records so he or she can fill in your return correctly. Re­ member, if someone else prepares your return incor­ rectly — you are still responsible. Step 2 Obtain any forms or schedules you may need. The fastest way to obtain forms is to download them from our website www.revenue.alabama.gov. Also see page 33 for more information. Step 3 Sign and date your return. Form 40, 40A, or 40NR is not considered a return unless you sign it. Please sign the return in black ink only. Your spouse must also sign if it is a joint return. Original signatures are required or the return will not be accepted. Step 4 Attach all necessary forms and schedules. Attach the state copy of all Forms W-2, W-2G, and 1099 to the front of your return. Attach schedules and forms in sequential order, starting with Form 40. If you need more space on forms or schedules, at­ tach separate sheets and use the same format as printed forms, but show your totals on the printed forms. Please use sheets that are the same size as the forms and schedules. Be sure to put your name and social security number on these separate sheets and attach them at the end of the return. Before mailing your return, check to make sure you have retained an exact copy for your records. If you owe tax, be sure to include your payment and Form 40V with your return. SECTION Specific 3 Instructions Name and Address Please type or print your name, address, and social security number in the appropriate blocks. If you live in an apartment, please include your apart­ ment number in the address. If the post office delivers mail to your P.O. box number rather than to your street address, write the P.O. box number instead of your street address. Social Security Number Each year thousands of taxpayers file returns using an incorrect social security number. Usually this number belongs to another taxpayer. It is very important that you file your return using the correct social security number. Failure to use your correct social security number(s) in the space(s) provided WILL DELAY the processing of your refund. Listed below are a few of the common rea­ sons why a social security number is reported incorrectly:  failed to enter number on return,  memorized wrong number,  copied number wrong,  gave an incorrect number to the tax preparer, or  gave your employer an incorrect number. IMPORTANT: Check your W-2 forms. Your employer may be reporting an incorrect number for you. If you are married and filing a joint return, write both social security numbers in the blocks provided. If you are married and filing separate Alabama re­ turns, write your spouse’s social security number on line 3. If your spouse is a nonresident alien, has no income, does not have a social security number, and you file a separate return, check the "NRA" box and leave the block for your spouse's social security number blank. If you and your spouse file a joint return, your spouse must have a social security number. If you or your spouse do not have a social security number, please get Form SS-5 from a Social Security Administration (SSA) office. File it with your local SSA office early enough to get your number before April 15. IMPORTANT: Please notify the Social Security Admin­ istration (SSA) immediately in the event you have changed your name because of marriage, divorce, etc., so the name on your tax return is the same as the name the SSA has on record. This helps prevent delays in pro­ cessing your return. Filing Status and Personal Exemption Lines 1 through 4 You should check only the box that describes your fil­ ing status. The personal exemption will be determined by your filing status on the last day of the tax year. Single Consider yourself single if on December 31, 2024, you were unmarried or separated from your spouse ei­ ther by divorce or separate maintenance decree. If you check box 1, enter $1,500 on line 13. Married – Joint or Separate Returns? Joint Returns. Most married couples pay less tax if they file a joint return. If you file a joint return, you must report all income, exemptions, deductions, and cred­ its for you and your spouse. Both of you must sign the return even if only one of you had income. Common law marriages entered into before January 1, 2017, are recognized by the State of Alabama for income tax purposes. CAUTION: You cannot file a joint return if you are a res­ ident of Alabama and your spouse is a resident of an­ other state. You should file as “married filing separate.” You and your spouse can file a joint return if you were living together on December 31, 2024, even if you did not live together for the entire year. Both of you are responsible for any tax due on a joint return, so if one of you does not pay the other may have to. NOTE: If you file a joint return, you may not, after the due date of the return, choose to file separate returns for that year. If your spouse died in 2024, you can file a joint return for 2024. You can also file a joint return if your spouse died in 2025 before filing a 2024 return. For details on how to file a joint return, see Death of Taxpayer on page 18. If you check box 2, enter $3,000 on line 13. Separate Returns. You can file separate returns if both you and your spouse had income, or if only one of you had income. If you file a separate return, report only your own in­ come, exemptions, deductions, and credits. You are re­ sponsible only for the tax due on your return. NOTE: Alabama is not a community property state. If you file a separate return, write your spouse’s so­ cial security number on line 3. If your spouse is not re­ quired to file, attach a statement explaining why. If you check box 3, enter $1,500 on line 13. Head of Family An individual shall be considered “Head of Family” if, and only if, such individual is not married at the close of their tax year, is not a surviving spouse and their qual­ ifying dependent is not a foster child. You may check the box on line 4 ONLY IF on De­ cember 31, 2024, you were unmarried or legally sepa­ rated and meet either test 1 or 2 below. Test 1. You paid more than half the cost of keeping up a home for the entire year provided that the home was the main home of your parent whom you can claim as a dependent. Your parent did not have to live with you in your home, OR Test 2. You paid more than half the cost of keeping up a home in which you lived and in which one of the fol­ lowing also lived for more than 6 months of the year (temporary absences, such as for vacation or school, are counted as time lived in the home): a. Your unmarried child, grandchild, great-grand­ child, etc., adopted child, or stepchild. This child does not have to be your dependent. b. Your married child, grandchild, great-grandchild, etc., adopted child, or stepchild. This child must be your dependent. But if your married child’s other parent claims him or her as a dependent under the Federal rules for Page 6

“Children of Divorced or Separated Parents,” this child does not have to be your dependent. c. Any relative whom you can claim as a dependent. (See definition of dependent on page 8.) If the person for whom you kept up a home was born or died during the year, you may still file as “Head of Family” if the home was that person’s main home for the part of the year he or she was alive. Special Rules A nonresident taxpayer who receives income from Alabama sources or for performing services within Ala­ bama and who also had income while a resident of Ala­ bama during the same tax year must file both the Alabama Nonresident Form 40NR and the Alabama Part-year resident Form 40. If you are required to file both returns, the total personal exemption and the dependent exemption must be claimed on the part- year return (Form 40). No personal exemption or de­ pendent exemption can then be claimed on the nonresident return (Form 40NR). Income All income is subject to Alabama income tax unless specifically exempted by state law. The term “income” includes, but is not limited to, salaries, wages, commis­ sions, income from business or professions, alimony, rents, royalties, interest, dividends, and profits from sales of real estate, stocks, or bonds. Military pay is taxable income except for compensation received for active service in a designated combat zone. Examples of Income You MUST Report The following kinds of income should be reported on Forms 40, 40A, or 40NR and related forms and schedules:  Wages including salaries, fringe benefits, bonuses, commissions, fees, and tips.  Dividends (Schedule B).  Interest on: bank deposits, bonds, notes, federal income tax refunds, mortgages on which you receive payments, accounts with savings and loan associations, mutual savings banks, credit unions, etc. (Schedule B).  Original Issue Discount (Schedule B).  Distributions from an Individual Retirement Arrangement (IRA) including SEPs and DECs, if you ex­ cluded these amounts in a prior year.  Bartering income (fair market value of goods or services you received in return for your services).  Business expense reimbursements you received that are more than you spent for the expenses.  Amounts received in place of wages from acci­ dent and health plans (including sick pay and disability pensions) if your employer paid for the policy.  Alimony or separate maintenance payments re­ ceived from and deductible by your spouse or former spouse.  Life insurance proceeds from a policy you cashed if the proceeds are more than the premium you paid.  Profits from businesses and professions (Federal Schedule C or C-EZ).  Your share of profits from partnerships and S Corporations (Schedule E).  Profits from farming (Federal Schedule F).  Pensions and annuities other than those listed in “Examples of Income You DO NOT Report.”  Lump-sum distributions, endowments.  Gains from the sale or exchange (including barter) of real estate, securities, coins, gold, silver, gems, or other property (Schedule D).  Gains from the sale of your personal residence as reported on your Federal return.  Rents and Royalties (Schedule E).  Your share of estate or trust income (Schedule E).  Prizes and awards (contests, lotteries, and gam­ bling winnings).  Income from sources outside the United States.  Director’s fees.  Fees received as an executor or administrator of an estate.  Embezzled or other illegal income.  Refunds of federal income tax if deducted in a prior year and resulted in a tax benefit.  Payments received as a member of a military service are taxable except for combat pay and certain allowances.  Property transferred in conjunction with perform­ ance of services.  Jury duty pay.  Nonqualified Withdrawal from Alabama College Counts 529 Fund. Examples of Income You DO NOT Report Do not include these amounts when deciding if you must file a return.  United States Retirement System benefits.  State of Alabama Teachers’ Retirement System benefits.  State of Alabama Employees’ Retirement System benefits.  State of Alabama Judicial Retirement System benefits.  Military retirement pay.  Tennessee Valley Authority Pension System benefits.  United States Government Retirement Fund benefits.  Payments from a “Defined Benefit Retirement Plan” in accordance with IRC 414(j). Contact your re­ tirement plan administrator to determine if your plan qualifies.  Federal Railroad Retirement benefits.  Federal Social Security benefits.  State income tax refunds.  Unemployment compensation.  Welfare benefits.  Disability retirement payments (and other bene­ fits) paid by the Veteran’s Administration.  Workman’s compensation benefits, insurance damages, etc., for injury or sickness.  Child support.  Gifts, money, or other property you inherit or that was willed to you.  Dividends on veteran’s life insurance.  Life insurance proceeds received because of a person’s death.  Interest on obligations of the State of Alabama or any county, city, or municipality of Alabama.  Interest on obligations of the United States or any of its possessions.  Amounts you received from insurance because you lost the use of your home due to fire or other casu­ alty to the extent the amounts were more than the cost of your normal expenses while living in your home. (You must report as income reimbursements for normal living expenses.)  Military allowances paid to active duty military, National Guard, and active reserves for quarters, sub­ sistence, uniforms, and travel.  Subsistence allowance received by law enforce­ ment and corrections officers of the State of Alabama.  All retirement compensation received by an eligi­ ble fire fighter or a designated beneficiary from any Ala­ bama firefighting agency.  All retirement compensation received by an eligi­ ble peace officer or a designated beneficiary from any Alabama police retirement system.  Death benefits received by a designated benefi­ ciary of a peace officer or fireman killed in the line of duty.  Income earned while serving as a foreign mis­ sionary after first serving 24 months as a missionary in a foreign country.  Compensation received from the United States for active service as a member of the Armed Forces in a combat zone designated by the President of the United States.  An amount up to $50,000 for Tax Years 2020 and forward and $25,000 for Tax Years 2019 and prior re­ ceived as severance, unemployment compensation or termination pay, or as income from a supplemental in­ come plan, or both, by an employee who, as a result of administrative downsizing, is terminated, laid-off, fired, or displaced from his or her employment, shall be ex­ empt from state income tax. If the exempt severance pay is included in your state wages, contact your employer for a corrected W-2.  Beginning January 1, 1998, all benefits received from Alabama Prepaid Affordable College Tuition Con­ tracts (PACT).  Qualified Withdrawal from Alabama College Counts 529 fund.  Income received from the Department of Defense as a result of a member of the military killed in action in a designated combat zone.  Any income earned by the spouse in the year of death of a member of the Military who has been killed in action in a designated combat zone.  Beginning January 1, 2016, all income, interest, dividends, gains or benefits of any kind received from an ABLE (Achieving Better Life Experience) savings account.  Effective with tax year 2020, insurance benefits received by a certified firefighter as a result of a cancer diagnosis to any extent the amounts are included in the federal adjusted gross income of the taxpayer and are not exempt under any other law. For more information please see Act 2019-361. Rounding Off to Whole Dollars Round off cents to the nearest whole dollar on your return and schedules. You can drop amounts under 50 cents. Increase amounts from 50 to 99 cents to the next dollar. For example: $1.39 becomes $1.00, and $2.69 becomes $3.00. Negative numbers - Please enter all negative num­ bers with negative signs (-). Do not use parenthesis ( ). Line 5 Wages, Salaries, Tips, Etc. Report all W-2 information on Schedule W-2. See Schedule W-2 instructions for more information. On col­ umn B – “Income,” enter the amount from Schedule W- 2, Line 18, Column I plus Column J.

Page 7

NOTE: If you are a resident of Alabama and you earn wages in more than one state, include the total “State Wages” from all states. NOTE: State of Alabama employees will find that the amount taxable for state purposes is, in most cases, more than the amount taxable for federal purposes. This is due to the fact that amounts deducted from their wages as “Contributions to the Alabama State Retire­ ment System” qualify for deferral on the Federal return, but do not qualify for deferral on the Alabama return. Part-year Residents. If you were a resident of Ala­ bama for only a part of the year, enter only the income earned during the period of residence in Alabama. Statutory Employees. If you were a statutory em­ ployee, the “Statutory Employee” box of your W-2 form should be checked. Statutory employees include full time life insurance salespeople, certain agent or commission drivers, traveling salespeople, and certain homework­ ers. Please see the Schedule W-2 instructions for infor­ mation on how to report your “Statutory Employee” wages. Alabama Income Tax Withheld Alabama tax withheld information must be re­ ported on Schedule W-2. (See Schedule W-2 instruc­ tions for more information.) The amount withheld is shown on the state copy of your Form W-2. This copy should be marked “To Be Filed With Your Alabama In­ come Tax Return.” NOTE: Do not change or alter the amount of tax with­ held or wages reported on your Form W-2. If any amount is incorrect or illegible, you should contact your employer and request a corrected statement. Do not include the following as Alabama income tax:  Federal income tax,  FICA tax (Social Security and Medicare),  Local, city, or occupational tax, or  Taxes paid to another state. In Column A – “Alabama tax withheld,” enter the total amount from Schedule W-2, Line 18, Column G. Line 6 Interest and Dividend Income Enter your TOTAL taxable income from interest and dividends. If the total taxable and nontaxable interest and dividends you received in 2024 is $1,500 or more, you must complete and attach Schedule B. Part-year resi­ dents enter only the amount of interest and dividend in­ come earned during the period of residency. The payer should send you a Form 1099-INT, Form 1099-OID, or 1099-DIV, if applicable, showing interest or dividends you must report. To see what interest and dividends are taxable, read the instructions for Schedule B in this booklet. Line 7 Other Income All taxable income you received that is not reported on lines 5 and 6 should be entered on line 7. This in­ cludes rents, royalties, gains from sale of property, items not included in “State wages” box on W-2 forms, etc. See Examples of Income You DO NOT Report and Examples of Income You MUST Report on page 7 of these instructions for further details on income which should be included on this line. If you have income from other sources, you must complete page 2, Part I, and attach the appropriate schedule(s). Line 9 Adjustments to Income If you made payments to a traditional Individual Re­ tirement Arrangement (IRA) or to a Keogh plan, you may be entitled to claim these payments as an adjustment to income. Also deductible as an adjustment to income are penalties you incurred for the early withdrawal of interest before maturity. You can deduct payments of alimony or separate maintenance made under a court decree to the same extent allowed for federal income tax purposes. Certain legal and medical expenses paid or incurred in the adoption of a minor are deductible as an adjust­ ment to income. Certain active duty Armed Forces members may deduct certain moving expenses. The new job location must be within the State of Alabama. Self-employed persons may deduct health insurance premiums to the same extent as allowed for federal purposes. For more information on the above exclusions, please see the instructions for Part II on page 15. The total adjustments to income from page 2, Part II, line 16 should be entered on page 1, line 9. Line 10 Adjusted Gross Income If the amount on line 10 is less than zero, you may have a net operating loss that you can carry to another tax year. If you carry the loss back to earlier years, you should check the amended return box on your Form 40 and attach Form NOL-85 and/or Form NOL-85A. Line 11 Itemized or Standard Deduction You have the option to either itemize your deduc­ tions or you may claim the optional Standard Deduction. You should compute your deduction both ways to de­ termine the option that gives you the larger deduction. If you elect to claim the Standard Deduction on your re­ turn and it later becomes necessary to change to item­ ized deductions, you may do so by filing an amended return. If married and filing separate returns, both spouses must claim the same deduction unless the spouses have lived apart for the entire year, in which case each spouse may claim either deduction. However, neither spouse may claim a deduction for expenses paid by the other. See the instructions for Schedule A for items that may be claimed as an itemized deduction. Part-year residents of Alabama may claim only the itemized deductions actually paid during the period of Alabama residency. Itemized Deductions. If you elect to itemize your deductions, you should check box a on line 11 and com­ plete and attach Schedule A. Standard Deduction. If you elect to claim the Stan­ dard Deduction, you must check box b on line 11 and use the Standard Deduction chart on page 9 to deter­ mine your allowable deduction. A dependent or student may take the standard deduction even if claimed as a dependent by someone else. Line 12 Federal Income Tax Deduction Use your 2024 federal income tax return and the worksheet on page 31 to determine your federal income tax deduction. If claiming a deduction on line 12, you must attach page 1, 2 and Schedule 1 of your Federal Return, if applicable. PLEASE NOTE: The Federal line references were correct at the time these forms and instructions were printed. However, there may have been changes to Fed­ eral forms after our print deadline and the line numbers referenced for our forms may have changed. If you have questions as to the correct line number on the Federal return, please feel free to call one of our taxpayer serv­ ice centers listed on page 3.

Joint Federal and Separate Alabama Returns, or Part Year Residents. If a married couple elects to file a joint federal return and separate Alabama returns, the federal income tax liability must be determined by a ratio of each spouse’s federal adjusted gross income to total joint federal adjusted gross income, or if filing as a part year resident, the ratio of Alabama adjusted gross in­ come to federal adjusted gross income. This calculation is required regardless of the method used in claiming other deductions. Line 13 Personal Exemption Enter the personal exemption from line 1, 2, 3, or 4. Note: Part year residents are allowed the full exemption amount. A dependent or student may take the personal exemption even if claimed as a dependent by someone else. Line 14 Dependent Exemption A “dependent” as defined under Alabama law is an individual other than the taxpayer and his or her spouse who received over 50% of his or her support from the taxpayer during the tax year and is also related to the taxpayer in one of the following relationships: Son Stepfather Daughter Mother-in-law Stepson Father-in-law Stepdaughter Brother-in-law Legally adopted child Sister-in-law Parent Son-in-law Grandparent Daughter-in-law Grandchild If related by blood: Brother Uncle Sister Aunt Stepbrother Nephew Stepsister Niece Stepmother

NOTE: You cannot claim a foster child, friend, cousin, yourself, or your spouse as a dependent under Alabama law. Birth or Death of Dependent. You can take an ex­ emption for a dependent who was born or who died dur­ ing 2024 if he or she met the qualifications for a dependent while alive. Support. You must have provided over 50% of the dependent’s support in 2024. If you file a joint return, the Page 8

$ 0 – $25,999 $26,000 – $26,499 $25,500 – $26,999 $27,000 – $27,499 $27,500 – $27,999 $28,000 – $28,499 $28,500 – $28,999 $29,000 – $29,499 $29,500 – $29,999 $30,000 – $30,499 $30,500 – $30,999 $31,000 – $31,499 $31,500 – $31,999 $32,000 – $32,499 $32,500 – $32,999 $33,000 – $33,499 $33,500 – $33,999 $34,000 – $34,499 $34,500 – $34,999 $35,000 – $35,499 $35,500 and above $ 0 – $25,999 $26,000 – $26,499 $26,500 – $26,999 $27,000 – $27,499 $27,500 – $27,999 $28,000 – $28,499 $28,500 – $28,999 $29,000 – $29,499 $29,500 – $29,999 $30,000 – $30,499 $30,500 – $30,999 $31,000 – $31,499 $31,500 – $31,999 $32,000 – $32,499 $32,500 – $32,999 $33,000 – $33,499 $33,500 – $33,999 $34,000 – $34,499 $34,500 – $34,999 $35,000 – $35,499 $35,500 and above $ 0 – $25,999 $26,000 – $26,499 $26,500 – $26,999 $27,000 – $27,499 $27,500 – $27,999 $28,000 – $28,499 $28,500 – $28,999 $29,000 – $29,499 $29,500 – $29,999 $30,000 – $30,499 $30,500 – $30,999 $31,000 – $31,499 $31,500 – $31,999 $32,000 – $32,499 $32,500 – $32,999 $33,000 – $33,499 $33,500 – $33,999 $34,000 – $34,499 $34,500 – $34,999 $35,000 – $35,499 $35,500 and above $8,500 $8,325 $8,150 $7,975 $7,800 $7,625 $7,450 $7,275 $7,100 $6,925 $6,750 $6,575 $6,400 $6,225 $6,050 $5,875 $5,700 $5,525 $5,350 $5,175 $5,000 $ 0 – $12,999 $13,000 – $13,249 $13,250 – $13,499 $13,500 – $13,749 $13,750 – $13,999 $14,000 – $14,249 $14,250 – $14,499 $14,500 – $14,749 $14,750 – $14,999 $15,000 – $15,249 $15,250 – $15,499 $15,500 – $15,749 $15,750 – $15,999 $16,000 – $16,249 $16,250 – $16,499 $16,500 – $16,749 $16,750 – $16,999 $17,000 – $17,249 $17,250 – $17,499 $17,500 – $17,749 $17,750 and above $4,250 $4,162 $4,074 $3,986 $3,898 $3,810 $3,722 $3,634 $3,546 $3,458 $3,370 $3,282 $3,194 $3,106 $3,018 $2,930 $2,842 $2,754 $2,666 $2,578 $2,500 $5,200 $5,065 $4,930 $4,795 $4,660 $4,525 $4,390 $4,255 $4,120 $3,985 $3,850 $3,715 $3,580 $3,445 $3,310 $3,175 $3,040 $2,905 $2,770 $2,635 $2,500 $3,000 $2,975 $2,950 $2,925 $2,900 $2,875 $2,850 $2,825 $2,800 $2,775 $2,750 $2,725 $2,700 $2,675 $2,650 $2,625 $2,600 $2,575 $2,550 $2,525 $2,500 Page 9 Column A Column B Column C Tax Due – Total Purchase Price Tax Rate (Multiply Col. A by Col. B)

1. All purchases EXCEPT automotive vehicles and farm machinery . . . . . . . . . . . . . . .04 2. ATVs, off-road motorcycles, riding lawnmowers, self-propelled construction equipment and other automotive vehicles that are not titled or registered by the county licensing official . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .02

3. Farm machinery or equipment and replacement parts thereof . . . . . . . . . . . . . . . . . . .015

4. TOTAL TAX DUE (Total of Column C). Carry this amount to Schedule ATP, Part I, line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Alabama Use Tax Worksheet Report 2024 purchases for use in Alabama from out-of-state sellers on which tax was not collected by the seller. Standard Deduction Married Filing Joint Married Filing Separate Head of Family Single ____________________________ ____________________________ ____________________________ ____________________________ AL Adjusted Gross Standard AL Adjusted Gross Standard AL Adjusted Gross Standard AL Adjusted Gross Standard Income (AL Line 10) Deduction Income (AL Line 10) Deduction Income (AL Line 10) Deduction Income (AL Line 10) Deduction

support can be from you or your spouse. You cannot claim credit on an Alabama return for a dependent if you provided less than 50% of the support under Alabama law as you can under federal law in certain conditions. In figuring total support, you must include money the dependent used for his or her own support even if this money was not taxable (for example: gifts, savings, wel­ fare benefits). If your child was a student, do not include amounts he or she received as scholarships. Support includes items such as food, a place to live, clothes, medical and dental care, recreation, and edu­ cation. In figuring support, use the actual cost of these items. However, the cost of a place to live is figured at its fair rental value. In figuring support, do not include items such as in­ come taxes, social security taxes, premiums for life in­ surance, or funeral expenses. If you qualify to claim your child and/or other individ­ uals as your dependent, you must complete on page 2 Part III. The amount entered on page 2, Part III, line 2, should be entered on page 1, line 14. Use the following chart to determine the per-depen­ dent exemption amount. Amount on Dependent Page 1, Line 10 Exemption 0 - 50,000 1,000 50,001 - 100,000 500 Over 100,000 300 Line 17 Figuring Your Tax You must figure your tax from the Tax Tables un­ less you are claiming a carryover or carryback Net Op­ erating Loss from another year. Indicate the method you are using by checking the appropriate box. If you are claiming a Net Operating Loss from another year, you must complete and attach Form NOL-85A. Line 18 Net Tax Due Alabama If you are using tax credits to reduce your tax liabil­ ity, Schedule OC must be completed in order to com­ pute your net tax due. You must check the box to indicate you are using Schedule OC to compute your net tax due. If you do not have any tax credits, enter the amount from line 17. Credits - Schedule OC Schedule OC must be completed for a credit claim and Individual taxpayers must register to set up an ac­ count in My Alabama Taxes (MAT) at

www.myalabamataxes.alabama.gov for approval before claiming certain credits on their tax return. Once logged into MAT, a taxpayer will need to locate the “Individual Income Tax” account type, then select “Submit a Credit Claim” from the “Tax Incentives” section on the right mar­ gin of the page and follow a short series of steps to re­ serve their credit. For individuals who do not have a MAT account or are unable to set up a MAT account, go to the MAT homepage, select “Submit an Individual Credit Claim” from the “Individuals” section on the main page and follow a short series of steps to reserve your credit. If the credit claimed on an individual income tax return is from a Schedule K-1 issued by a pass through entity, the credit claim will be submitted by the entity and no action is required by the individual. Supporting documentation for certain credits is required to be uploaded in MAT. Taxpayers needing assistance with reserving a tax credit may call (334) 353-9770 or (334) 353-0602. While all tax credits are reported on Schedule OC, some require a separate schedule to be completed be­ fore entering the results on Schedule OC and some re­ quire a MAT account to reserve their credit approval before submission on Schedule OC. Please visit the Department’s website for more in­ formation on the Schedule OC and Schedule OC in­ structions for each of the following tax credits: Credit for Taxes Paid to Other States, Alabama Enterprise Zone Credit, Basic Skills Education Credit, Rural Physician Credit, Coal Credit, Full Employment Act of 2011 Credit, Veterans Employment Act – Employers Credit, Veterans Employment Act- Business Start Up Expense Credit, Credit For Taxes Paid to a Foreign Country, Qualified Ir­ rigation System/Reservoir System tax Credit, Alabama Accountability Tax Credit- School Transfer Credit, Ala­ bama Accountability Act Credit – Scholarship Granting Organization (SGO) credit, Alabama Adoption Credit, 2013 Alabama Historic Rehabilitation Tax Credit , Ca­ reer Technical Dual Enrollment Credit, Investment Credit – Alabama Jobs Act, Alabama Renewal Act – Port Credit, Alabama Renewal Act – Growing Alabama Credit, Apprenticeship Tax Credit, 2017 Alabama His­ toric Tax Rehabilitation Credit, Railroad Modernization Act of 2019 Credit, Storm Shelter Credit, Volunteer Emergency Responders Tax Credit, Innovate Alabama Tax Credit, Volunteer First Responder Mileage Income Tax Credit, Preceptor Tax Incentive Credit, and the In­ come Tax Capital Credit. For more information on credits see Schedule OC. Credit for Taxes Paid to Another State. You must complete Schedule CR and you must attach a copy of other state’s return or W-2G’s if the taxing state does not allow a return to be filed for gambling winnings. The credit is provided to prevent the double taxation of income and is only available to legal residents of Ala­ bama filing Form 40 who have income from sources out­ side of Alabama that is being taxed by Alabama and another state (or territory of the United States) in the same tax year. Residents of Alabama for only a part of the tax year can claim this credit only if the returns filed with Alabama and the other state cover the same periods. If the state for which you are claiming a credit allows for credits instead of personal exemptions, call (334) 242-1170 for further information in converting this credit for Alabama purposes. No credit is allowable when the income from sources outside of Alabama is totally offset by a corresponding deduction. However, income from sources outside of Alabama that is reported on the return and not totally off­ set by a corresponding deduction may result in a credit. In such cases the credit is limited to the lesser of the tax actually due to the other state or territory or the amount that would be due on the same income computed at the income tax rate in Alabama. An example of this situation is shown in the booklet in the instructions for Schedule CR on page 22. The Schedule CR calculation should not be used by a taxpayer who paid income tax to a foreign country. Taxpayers who paid taxes to a foreign country should use Section B, Part I of Schedule OC. Please see rule 810-3-21-.03 for calculation of credit when tax was paid to a foreign country. For further information for Schedule CR see page 22. Line 19 Additional Taxes Please complete Schedule ATP to report consumer use tax and Catastrophe savings tax, enter amount from Schedule ATP, Part I, Line 3. Consumer Use Tax: Review the purchases you made during 2024. If you purchased items for use in Ala­ bama from out-of-state sellers who did not charge sales or use tax, you owe consumers use tax on the items. If you made no purchases from out-of-state sellers, enter 0 (zero) on Schedule ATP, Part I, line 1 and check the box. Use tax is the counterpart of the sales tax. State use tax is imposed at the same rate and on the same type of transactions as sales tax and is due from the consumer when the sales tax is not collected. When you purchase merchandise from a retail store or other business es­ tablishment in Alabama, the seller is required to collect sales tax on the purchase. When you purchase mer­ chandise from a business located outside of Alabama the seller might collect use tax on the purchase. How­ ever, not all out-of-state businesses are registered and required to collect Alabama tax. As the consumer, you are responsible for ensuring that sales or use tax is paid on your purchases. When you purchase merchandise for storage, use or consumption in Alabama and the re­ tail seller does not collect tax on the purchase, you must report and pay consumer use tax on the purchase price. Usually, these purchases are made from catalogs, over the internet, or by telephone and include items such as:  Clothing  Books  Computers  Computer Software  Furniture  Magazine Subscriptions  Sporting Goods  Jewelry  Electronic Equipment  CDs, DVDs, Audio & Video Cassettes  Photographic Equipment  Musical Equipment  Automotive Accessories and Parts  ATVs  Lawn and Garden Equipment Applicable State Use Tax Rates The general use tax rate of 4% applies to all pur­ chases of merchandise, except where a different rate of tax is expressly provided. The automotive use tax rate of 2% applies to pur­ chases of automotive vehicles. Where any used vehicle is traded-in on the purchase of a new or used vehicle, the tax is due on the trade difference, that is, the price of the new or used vehicle purchased less the credit for the used vehicle taken in trade. The county licensing official will collect the tax due on purchases of automotive ve­ hicles that are required to be titled or registered includ­ ing purchases of automobiles, trucks, trailers, mobile homes, and motor boats. Do not include purchases of vehicles that are titled or registered in the calculation on the worksheet on page 9. You must report and pay the use tax due on other purchases of automotive vehi­ cles including ATVs, off-road motorcycles, riding lawnmowers, self-propelled construction equipment, and other self-propelled instruments of conveyance. The agriculture use tax rate of 1.5% applies to pur­ chases of machinery or equipment used in connection with the production of agricultural products, livestock, or poultry on farms and the replacement parts for such ma­ Page 10

chinery or equipment. Where any used farm machinery or equipment is traded-in on the purchase of new or used farm machinery or equipment, the tax is due on the trade difference, that is, the price of the new or used machin­ ery or equipment less the credit for the used machinery or equipment taken in trade. Local Use Tax: City and County use tax may also be due and should be reported and paid to the appropriate local tax authority. For information about reporting local use tax please see the department’s web page at www.revenue.alabama.gov. You can use either the Alabama Use Tax Table on page 11 or the worksheet on page 9 if you only have In­ ternet or catalog purchases that do not include automo­ tive vehicles, farm machinery, or farm machinery replacement parts; otherwise use the worksheet on page 9 to compute Alabama Use Tax. For more information regarding consumers use tax call (334) 242-1490. Catastrophe Savings Tax: Withdrawals that exceed the qualified catastrophe expenses during the taxable year, must be included in income. This amount is taxed at an additional 2.5% under Section 40-18-312 (d)(1) un­ less: (1) the taxpayer no longer owns a legal residence that qualifies pursuant to Chapter 7, or (2) the distribu­ tion is made on or after the date on which the taxpayer attains the age of seventy (70) years old and is a self-in­ sured individual who chooses not to obtain insurance on his or her legal residence. Enter the additional tax on Schedule ATP, Part I, line 2. Line 20 Alabama Election Campaign Fund If you wish to make a voluntary contribution to Ala­ bama’s Democratic Party or Republican Party indicate the amount and party by checking the proper box(es) on lines 20a or 20b. Each individual may contribute $1 to either party. If a joint return is filed, each spouse may contribute $1 to either party. If you make a voluntary contribution to this fund it WILL INCREASE your tax by the amount of the contribution. The total amount entered on line 20a or 20b cannot exceed $2 for a married couple filing a joint return or $1 for all other filers. Line 22 Alabama Income Tax Withheld Enter the total Alabama income tax withheld as shown on line 5A. Line 23 2024 Estimated Tax Payments/ Automatic Extension Payment Enter on this line any payments you made on your estimated Alabama income tax (Form 40ES) for 2024 or automatic extension (Form 40V). CAUTION — DO NOT INCLUDE:  The amount shown on line 29 of your 2023 Form 40. This is the balance you owed for the tax year 2023, and cannot be claimed as paid on your 2024 estimated tax even though you paid it in 2024.  Any overpayment from 2023 that was refunded to you. If you and your spouse paid joint estimated tax but are now filing separate Alabama income tax returns, ei­ ther of you may claim all of the amount paid, or you can each claim a part of it. Please be sure to show both so­ cial security numbers on the separate returns. If you and your spouse paid separate estimated tax but are now fil­ ing a joint income tax return, add the amounts you each paid. These instructions also apply if your spouse died dur­ ing the year. Name Change. If you changed your name because of marriage, divorce, etc., and you made estimated tax payments using your former name, attach a statement to Form 40 explaining all the payments you and your spouse made in 2024 and the name(s) and social secu­ rity number(s) under which you made the payments. Caution: It is very important that the social security num­ bers be the same on your current return, your last year’s return, and all of your estimate vouchers. The Depart­ ment will be unable to allow you proper credit for your payments unless the numbers are the same. If the De­ partment is unable to verify the amount claimed, you may be requested to submit copies of all your canceled checks substantiating the amount claimed. This will cause considerable delay in processing your return. Line 24 Previous Payments This line is for amended returns only. Enter the amount of your previous payment made with your origi­ nal return and/or billing notices and amended return(s). Line 25 Refundable Credit This line is only for the refundable portion of Alabama Accountability Act, Adoption Credit, or Historic Tax Re­ habilitation Act of 2017 Credit. Enter the amount from Schedule OC, Section F, line F4. Line 26 Payments from Schedule CP, Section B, Line 1 For tax years beginning on or after January 1, 2021, Act 2021-423 allows the owner, member, partner, or shareholder of an electing pass-through entity reporting income to be allowed a refundable credit in an amount equal to its pro rata or distributive share of the Alabama income tax paid by the electing pass-through entity with respect to the corresponding tax year. This amount needs to be reported on Schedule CP. Line 28 Previous Refund This line is for amended returns only. Enter the amount of your previous refund received from your orig­ inal return and amended return(s). Page 11 Alabama Use Tax Table for General Internet and Catalog Purchases

If purchases are over $2,499 use the Alabama Use Tax Worksheet on page 9 Purchases Subject to Use Tax At least But less than Use Tax Due 0 . . . . . . . . 50 . . . . . . . . 1 50 . . . . . . . . 100 . . . . . . . . 3 100 . . . . . . . . 150 . . . . . . . . 5 150 . . . . . . . . 200 . . . . . . . . 7 200 . . . . . . . . 250 . . . . . . . . 9 250 . . . . . . . . 300 . . . . . . . . 11 300 . . . . . . . . 350 . . . . . . . . 13 350 . . . . . . . . 400 . . . . . . . . 15 400 . . . . . . . . 450 . . . . . . . . 17 450 . . . . . . . . 500 . . . . . . . . 19 500 . . . . . . . . 550 . . . . . . . . 21 550 . . . . . . . . 600 . . . . . . . . 23 600 . . . . . . . . 650 . . . . . . . . 25 650 . . . . . . . . 700 . . . . . . . . 27 700 . . . . . . . . 750 . . . . . . . . 29 750 . . . . . . . . 800 . . . . . . . . 31 800 . . . . . . . . 850 . . . . . . . . 33 850 . . . . . . . . 900 . . . . . . . . 35 900 . . . . . . . . 950 . . . . . . . . 37 950 . . . . . . . . 1,000 . . . . . . . . 39 1,000 . . . . . . . . 1,050 . . . . . . . . 41 1,050 . . . . . . . . 1,100 . . . . . . . . 43 1,100 . . . . . . . . 1,150 . . . . . . . . 45 1,150 . . . . . . . . 1,200 . . . . . . . . 47 1,200 . . . . . . . . 1,250 . . . . . . . . 49 Purchases Subject to Use Tax At least But less than Use Tax Due 1,250 . . . . . . . . 1,300 . . . . . . . . 51 1,300 . . . . . . . . 1,350 . . . . . . . . 53 1,350 . . . . . . . . 1,400 . . . . . . . . 55 1,400 . . . . . . . . 1,450 . . . . . . . . 57 1,450 . . . . . . . . 1,500 . . . . . . . . 59 1,500 . . . . . . . . 1,550 . . . . . . . . 61 1,550 . . . . . . . . 1,600 . . . . . . . . 63 1,600 . . . . . . . . 1,650 . . . . . . . . 65 1,650 . . . . . . . . 1,700 . . . . . . . . 67 1,700 . . . . . . . . 1,750 . . . . . . . . 69 1,750 . . . . . . . . 1,800 . . . . . . . . 71 1,800 . . . . . . . . 1,850 . . . . . . . . 73 1,850 . . . . . . . . 1,900 . . . . . . . . 75 1,900 . . . . . . . . 1,950 . . . . . . . . 77 1,950 . . . . . . . . 2,000 . . . . . . . . 79 2,000 . . . . . . . . 2,050 . . . . . . . . 81 2,050 . . . . . . . . 2,100 . . . . . . . . 83 2,100 . . . . . . . . 2,150 . . . . . . . . 85 2,150 . . . . . . . . 2,200 . . . . . . . . 87 2,200 . . . . . . . . 2,250 . . . . . . . . 89 2,250 . . . . . . . . 2,300 . . . . . . . . 91 2,300 . . . . . . . . 2,350 . . . . . . . . 93 2,350 . . . . . . . . 2,400 . . . . . . . . 95 2,400 . . . . . . . . 2,450 . . . . . . . . 97 2,450 . . . . . . . . 2,500 . . . . . . . . 99

Line 30 Amount You Owe (If line 21 is larger than line 29) Subtract line 29 from line 21, and add line 31, enter the amount on line 30 – this is the amount you owe the State of Alabama. It must be paid using Form 40V. Pay the full amount by check or money order payable to the “Alabama Department of Revenue.” On your payment write your social security number, your daytime telephone number, and “2024 Form 40,” and remit your payment with Form 40V.

Electronic Payment Option You may pay your taxes online using your bank ac­ count (e-check), or a debit/credit card through MyAlaba maTaxes.gov. If you have a My Alabama Tax (MAT) account, log on to your account and click on the “Make a Payment” link. If you do not have a MAT account, go to www.myalaba mataxes.alabama.gov. Click on the “Make a Payment” link and complete the requested information. Paying by e-check is free. There is a convenience fee for debit/credit card payments.Do not use Form 40V when paying by ACH Debit or credit card. If payment for the full amount of tax due is not paid by the due date of the return, you will be charged inter­ est and will be subject to penalties. See Penalties and Interest on page 17. More importantly, if you submit your return without payment, a final assessment may be en­ tered by the Department. A final assessment which is not appealed is as conclusive as a judgment of a circuit court. The Department may then proceed with collection by issuance of legal processes including recording of tax liens, garnishment of wages or bank accounts, levy, or a writ of seizure directed to the county sheriff as pro­ vided by Sections 40-1-2, 40-2-11(16), and 40-29-23, Code of Alabama 1975. Line 31 Penalties Complete Schedule ATP, Part II if you have an Esti­ mated Tax Penalty or First-time Second Chance Home Buyer Savings Account penalty. Enter the amount from Schedule ATP, Part II, Line 3. Estimated Tax Penalty: If the amount you owe (Form 40, page 1, line 30) exceeds $500.00, you may be subject to an estimate or underestimation penalty. If at least two-thirds of your gross income for the taxable year is from farming and you file your return and pay the total tax by March 1, 2025, you are exempt from this penalty. Please check the box on Part II, line 1 of Sched­ ule ATP. See the Underpayment Penalty Section on page 17 of this booklet. You may need to complete Form 2210AL. See page 33, “How to Obtain Forms.” First-time Second Chance Home Buyer Savings Account Penalty: If the amount withdrawn from a First- time Second Chance Homebuyer savings account is not used for eligible expenses or rolled into another First Time and Second Chance Home Buyer saving account, a penalty equal to 10% of the non-qualified amounts withdrawn is due. Enter amount from Schedule HBC, Part IV, line 4. Line 32 Overpayment (If line 29 is larger than line 21) Subtract line 21 from line 29, and enter the amount on line 32 – this is the amount you overpaid. NOTE: The Alabama Department of Revenue will issue you a Form 1099-G for the overpayment amount. If you elect to itemize deductions on your 2024 Fed­ eral return and claim a deduction for Alabama Income Tax paid in 2024, the amount shown on line 32 should be reported as income on your 2025 Federal return. Line 33 Applied to 2025 Estimated Tax You may elect to credit all or part of the overpayment shown on line 32 to your 2025 estimated tax. (Place amount on line 33.) Once an election is made to apply this overpayment to your 2025 estimated tax, it cannot later be refunded to you or applied to pay additional tax for 2024. The amount entered on this line can only be claimed as a credit on your 2025 Alabama return. Line 34 Donation of Refunds Enter amount from Schedule DC, line 2. (See page 22.) You may elect to donate all or part of your overpay­ ment, as shown on page 1, line 32, to one or more of the funds as provided by the Alabama Legislature. The amounts entered on these lines will be paid to the pro­ grams you indicate. Any amount you contribute may be claimed as an itemized deduction when you file your 2025 Alabama Income Tax Return. (Caution: When re­ porting your refund on your 2025 Federal return, you should report the amount of overpayment shown on line 32.) NOTE: Amounts contributed to these funds WILL RE­ DUCE your refund. Also, once an election is made to contribute to these funds, that election is irrevocable and cannot later be refunded. If your return is corrected by the Department, the amount contributed cannot be used to pay any additional tax due. Line 35 Refunded to You If line 32 is greater than zero, subtract lines 31, 33 and 34 from line 32. You should receive a refund for the overpayment. If you file an early, accurate return, we will be able to process your refund more quickly. See “When Should I Expect My Refund?” and “Common Mis­ takes That Delay Refunds” on page 4 of this booklet for further information about your refund. Sign Your Return Form 40 is not considered a return unless you sign it. Please sign in black ink only. Your spouse must also sign if it is a joint return. If you are filing a joint return with your deceased spouse, see Death of Tax­ payer on page 18. Did You Have Someone Else Prepare Your Re­ turn? If you fill in your own return, the Paid Preparer’s Use Only area should remain blank. Someone who pre­ pares your return but does not charge you should not sign. Generally, anyone who is paid to prepare your tax return must sign your return and fill in the other blanks in the Paid Preparer’s Use Only area of the return. If you have questions about whether a preparer is required to sign a return, please contact an Alabama Taxpayer Service Center. The preparer required to sign your return MUST:  Sign in the space provided for the preparer’s sig­ nature. (Signature stamps or labels are not acceptable.)  Give you a copy of your return for your records in addition to the copy to be filed with the Alabama De­ partment of Revenue. BEFORE signing and mailing your return you should review it to make sure the preparer has entered the correct name(s), address, and social security num­ ber(s) in the spaces provided and reported all of your in­ come. REMEMBER, you are responsible for the information on your return even if you pay someone else to prepare it. Please enter your daytime phone number. This will enable us to contact you and help speed your refund if there are any problems with processing your return. If you want the Department to contact your tax pre­ parer instead, please give permission to do so by check­ ing the box above the signature line. Where To File Your envelope should be addressed in accordance with one of the following examples: If you are receiving a refund (Form 40, line 35), mail your return to: Alabama Department of Revenue P.O. Box 154 Montgomery, AL 36135-0001

If you are making a payment (Form 40, line 30), mail your return, Form 40V and payment to: Alabama Department of Revenue P.O. Box 2401 Montgomery, AL 36140-0001

If you are not receiving a refund or making a pay­ ment, mail your return to: Alabama Department of Revenue P.O. Box 327469 Montgomery, AL 36132-7469

Current year Form 40 returns should be mailed to one of the above addresses. Prior year Form 40 returns, amended returns, and any correspondence pertaining to a previously filed return should be mailed to: Alabama Department of Revenue Income Tax Administration Division P.O. Box 327464 Montgomery, AL 36132-7464

Page 2, Part I Other Income Line 1 Alimony Received Enter the amounts you received as alimony or sep­ arate maintenance. Amounts you received in 2024 are taxable to the same extent as for federal purposes. If you received payments under a divorce or sepa­ ration instrument after 1984, see the instructions for Part II, line 4 for information in determining whether these Page 12

A – IRA, SEP, Keogh, 401(k)(2), or 403(b) Distributions you received in 2024 which included nondeductible contributions. 1 Enter the Total Value (including withdrawals) of your account at the end of the taxable year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2 Nondeductible Contributions (see instructions). Enter the total of all amounts you contributed that did not qualify as an adjustment to income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Enter the total of all amounts you have withdrawn and excluded from income in a previous year’s Alabama return. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Balance of Nondeductible Contributions. Subtract line 3 from line 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5 2024 Withdrawals. Enter the amount you withdrew during the 2024 taxable year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6 Exclusion Ratio. Divide the amount on line 4 by the amount on line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7 Amount of Exclusion. Multiply the amount on line 5 by the percentage on line 6. Enter the result here, but DO NOT enter more than the amount on line 4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8 Amount Taxable. Subtract the amount on line 7 from the amount on line 5. If an IRA Distribution, enter result here and on Schedule RS, Part II for primary taxpayer and Part III for spouse. If other than an IRA Distribution, enter the result on Schedule RS Part II for primary taxpayer and Part III for spouse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 

B – Pensions, annuities, etc., you first began receiving after December 31, 1986 in which you had a cost basis. 9 Enter the total amount received this year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Amount Taxable. Use Federal Simplified General Rule or Federal General Rule (see page 15 of instructions) . . . . . . . . . . . . . . . . . . . . .  C – Pensions, annuities, etc., you first began receiving prior to January 1, 1987 in which you have not recovered your cost. 11 Enter amount received this year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Enter the amount of your unrecovered cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Amount Taxable. Subtract line 12 from line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14 TOTAL AMOUNT TAXABLE. Add the amounts on lines 10 and 13. If an IRA Distribution, enter the total here and on Schedule RS, Part II for primary taxpayer and Part III for spouse. If other than an IRA distribution, enter on Schedule RS, Part II for primary taxpayer and Part III for spouse. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  payments qualify as alimony. Transfers of Property Between Spouses or For­ mer Spouses. In general, no gain or loss will be recog­ nized on a transfer of property between spouses or former spouses. Please refer to Federal Law for more details. Line 2 Business Income or (Loss) If you conducted a business or practiced a profes­ sion during the taxable year, you must complete and at­ tach a copy of Federal Schedule C or C-EZ to your Alabama return. Generally, you may deduct the ordinary and neces­ sary expenses of doing business — the cost of mer­ chandise, salaries, interest, taxes, rent, repairs, and incidental supplies. In the case of capital investments and improvements in depreciable property such as build­ ings, machines, and similar items having a useful life of more than one year, Alabama law provides for a “rea­ sonable allowance” for depreciation over the useful life of the property. If some of your expenses are part business and part personal, you can deduct ONLY the business portion. Adjustments to Federal Schedules C and F. Ala­ bama law differs from federal law in the treatment of some of the expenses shown on Federal Schedules C and F, and certain items may need adjusting for Ala­ bama purposes. The expenses which may need adjust­ ing are:  Percentage Depletion Gas and Oil. In the case of oil and gas wells, the allowance for depletion shall be 12 percent of the gross income from the property during the taxable year, excluding from such gross income an amount equal to any rents or royalties paid or incurred by the taxpayer in respect to the property. Such amounts shall not exceed 50 percent of the net income of the tax­ payer, computed without allowance for depletion, from the property, except that in no case shall the depletion al­ lowance be less than the amount allowable under federal income tax law.  Cost Depletion Natural Resources Other than Gas and Oil. Alabama law has no provision for per­ centage depletion of natural resources other than gas and oil, as currently allowed under federal law. For Ala­ bama purposes, the depletion allowance shall be com­ puted using the cost depletion method.  Depreciation. Alabama law allows IRC Section 179 Expense for all taxable years beginning after De­ cember 31, 1989. Adjustments may be necessary if as­ sets were acquired and placed in service prior to tax years beginning before January 1, 1990.  Targeted “Jobs Credit.” You may have been al­ lowed to take a portion of your payroll expense as a “Tar­ geted Jobs Credit” on your federal return. This is an allowable expense for Alabama income tax purposes.  Passive Activity Losses. Alabama law has no provision, similar to current federal law, which limits the deduction of passive trade or business activity losses.  Office and Home Expense. Alabama Law has no provision similar to current Federal Law which limits the amount of otherwise deductible office and home expense. If you have adjustments involving any of the previ­ ously described expenses, attach an explanation and show the adjustment as “Other Expenses” on Federal Schedule C or F. The net profit or (loss) from business, as shown on Federal Schedule C-EZ or C after above adjustments (if applicable), should be entered on Part I, line 2. Line 3 Gain or (Loss) from Sale of Real Estate, Stocks, Bonds, Etc. If you sold real estate, stocks, bonds or other capital assets, use Schedule D to report the net gain (or loss). Schedule D is also used to report the net gain (or loss) from involuntary conversion of capital assets that are NOT held in connection with a trade or business, or a transaction entered into for profit. If you sold your personal residence, any gain real­ ized is taxable to the same extent as reported on your federal return. NOTE: A loss on the sale of a personal residence is NOT deductible. For additional information, see the instructions for Schedule D on page 23. Line 4 Retirement Income (Schedule RS) Complete Schedule RS to report fully or partially tax­ able pensions, annuities, IRA distributions (include SEP, Keogh, 401(k)(2), 403(b) distributions), other distribu­ tions and retirement distribution(s) exempt from Alabama Income. See the Schedule RS instructions for more in­ formation. IRA Distributions ROTH and Educational IRAs Use Schedule RS to report IRA distributions you re­ ceived. This includes regular distributions, early distri­ butions, rollovers, Roth conversions, and any other money or property you received from your IRA account or annuity. Generally, you will receive a Form 1099-R showing the “gross amount” and “taxable amount” of Page 13 1

4 5 6

7

8

10

13

14 Use Worksheet to report IRA distributions, other distributions, and pension and annuity income which are not fully taxable. If a distribution is fully taxable, it is not necessary to complete this worksheet Not Fully Taxable Pensions, Annuities, and IRA Distributions (Include SEP, Keogh, 401(k)(2), and 403(b) Distributions) 2

3 9 11 12 WORKSHEET – Partially Taxable Pensions, Annuities, and IRA Distributions. 00

00 00 %

00

00

00

00

00 00

00

00

00 00

your distribution. If your distribution is fully taxable or if only part of the distribution is taxable, enter it on Schedule RS, Part II or Part III if spouse's distribution. You MAY need to com­ plete the worksheet on page 13 to determine the amount taxable. If the “taxable amount” listed on your Form 1099-R is correct for Alabama purposes as for Federal purposes then you will NOT need to complete the work­ sheet. If the “taxable amount” listed on your Form 1099- R is NOT the same for Alabama purposes as for Federal purposes because you have a different cost basis, then you will need to complete the worksheet on page13 to calculate the amount taxable for Alabama purposes. IF THE IRA DISTRIBUTION IS ROLLED OVER, complete Schedule RS, Part I if no amount is taxable. Complete Schedule RS, Part II or Part III if amount is taxable. Attach a statement to your return with complete information about the IRA, your cost in the plan, and the type of retirement account in which the distributed funds were invested. Beginning in 1998, ROTH and EDUCATIONAL IRAs were recognized by the Alabama Department of Revenue. The same restrictions and limitations provided by the IRS apply when completing your Alabama return. However, be sure to use Alabama Adjusted Gross In­ come when computing your limitations. WHEN CONVERTING FROM A TRADITIONAL IRA TO A ROTH IRA, the taxable portion of the distribution (to be reported on Schedule RS, Part II or Part III) is the amount that you would have to include in income if you had taken a distribution and not converted or rolled over the traditional IRA into a Roth IRA. The taxable portion should not include any part of a withdrawal from a tradi­ tional IRA that is a return of your basis. CAUTION: If you have to complete the worksheet on page 13 to calculate partially taxable distributions from IRA withdrawals, any IRA distribution along with any tax­ able Roth conversion or taxable IRA rollover must be in­ cluded in Schedule RS, Part II for primary taxpayer or Part III for spouse. Rollover Distributions A “rollover” is a tax-free transfer of cash or other as­ sets from one retirement program to another. There are two kinds of rollovers to an individual retirement arrange­ ment (IRA): (1) a rollover from one IRA to another, and (2) a rollover from a qualified employer’s plan to an IRA. If you received a lump sum distribution from an Em­ ployee Benefit Plan, it should be included in gross in­ come in the year received. There is no provision in Alabama law for forward averaging of such distributions. If the lump sum distribution qualifies for the rollover provision of the Internal Revenue Code, it may also qual­ ify for the rollover provision of the Alabama Income Tax Code as provided in Alabama Income Tax Regulation 810-3-25-.05(5) reprinted below: Regulation 810-3-25-.05(5) — [Distributions from a trust that are not included in gross income of the indi­ vidual for federal purposes due to the “rollover provi­ sions” of Internal Revenue Code Sections 402, 403, 408, and 409 are excluded from Alabama gross income of the individual. These are: (a) qualified stock bonus, pensions, or profit sharing plans as described in Internal Revenue Code Section 401(a), and which are exempt under Internal Revenue Code Section 501(a), and meet the rollover requirements of Internal Revenue Code Section 402, (b) employee’s annuities which meet the require­ ments of Internal Revenue Code Section 404(a)(2), and the rollover requirements of Internal Revenue Code Sec­ tion 403, (c) individual retirement accounts that qualify under and meet the rollover provisions of Internal Revenue Code Section 408, and (d) retirement bonds that qualify under Internal Rev­ enue Code Section 409 or Internal Revenue Code Sec­ tion 219 and meet the “rollover provisions” of Internal Revenue Code Section 409.] If the lump sum distribution qualifies and is rolled over, enter the total amount received and the taxable portion, if any, in the spaces provided on Schedule RS, Page 1. A statement should also be attached to your re­ turn giving complete information about the retirement fund rolled over, your cost in the plan, and the type of retirement account in which the distributed funds were reinvested. Pensions and Annuities Use Schedule RS to report pension and annuity in­ come you received. Also, use these lines to report distri­ butions from SEP, Keogh, 401(k)(2), 403(b), and profit sharing plans. Generally, you will receive a Form 1099-R or a Form W-2P showing the amount of your distribution. Generally, unless specifically excluded by law, your pension payments are fully taxable if you did not con­ tribute to the cost of your pension annuity or you have re­ covered your cost in the plan on prior Alabama income tax returns. If your pension or annuity is fully taxable, enter it on Schedule RS, Part II for primary taxpayer or Part III for spouse. If only part is taxable, see the worksheet on page 13 to determine the amount taxable. Enter the tax­ able amount of your pension or annuity on Schedule RS, Part II for primary taxpayer or Part III for spouse. Worksheet for Partially Taxable Pensions, Annu­ ities, and IRA Distributions Use the worksheet on the previous page to report distributions from profit-sharing plans, retirement plans, employee savings plans, and individual retirement arrangements not fully taxable. Also, use this worksheet to report pension and annuity income not fully taxable. If the income or distribution is fully taxable you do NOT need to complete this worksheet. In general, you should receive a 1099-R showing the amount of your retirement plan distribution or income. If the taxable portion shown on your 1099-R is the same for Alabama purposes as for Federal purposes you do NOT need to complete this worksheet. Instead report the total and the taxable amount on Schedule RS, Part II for primary taxpayer or Part III for spouse. The taxable portion may NOT be the same for Ala­ bama purposes as for Federal purposes because you may have a different cost basis. In this case, you must complete this worksheet to calculate the amount taxable for Alabama purposes. Amounts you received from the following retirement systems are not taxable and should not be reported.  Alabama Teacher’s Retirement System.  Alabama Employee’s Retirement System.  Alabama Judicial Retirement System.  Civil Service Retirement System.  Retirement Systems created by the Federal So­ cial Security Acts.  Railroad retirement benefits received under the Federal Railroad Retirement Acts of 1935 and 1937.  Military Retirement Pay.  TVA Pension System Benefits.  U.S. Foreign Service Retirement and Disability Fund Annuities.  U.S. Government Retirement Fund Benefits.  Retirement benefits received from any Alabama firefighting agency by any eligible firefighter or desig­ nated beneficiary.  Retirement benefits received from any Alabama police system by any eligible peace officer or designated beneficiary.  Any “defined benefit” retirement plan in accor­ dance with IRC 414(j). Contact your retirement plan ad­ ministrator to determine if your plan qualifies. Use lines 1 through 8 to report amounts you with­ drew from your IRA, SEP, Keogh, 401(k)(2), or 403(b) account which are not fully taxable and for which you have not recovered any of your cost basis before Janu­ ary 1, 1987. If you began recovering your cost before January 1, 1987, you should report these distributions on lines 11, 12, and 13. A – IRA, SEP, Keogh, 401(k)(2) or 403(b) Distributions you received in 2024 which included nondeductible contributions. Line 1. Enter the total value of your IRA, SEP, Keogh, 401(k)(2) or 403(b) account at the end of the tax­ able year. The amount entered on this line should in­ clude any withdrawals you made from the account during 2024. If you have more than one IRA (or other type ac­ count) you must enter the total value of all such accounts even though you made withdrawals in 2024 from only one or more of these accounts. Caution: If you have more than one type of account (IRA, SEP, etc.) which includes contributions from which you received nondeductible distributions in 2024, you must make a separate computation for each type of account. Line 2. Nondeductible Contributions. Non de­ ductible contributions are those contributions to an IRA (or other type account) for which you have not claimed an adjustment to income on a previous year’s return. If a distribution is made from an IRA you contributed to prior to your residency in Alabama, your basis in that IRA for Alabama purposes will be the same as your basis for federal purposes. Amounts may be considered nondeductible con­ tributions for the following reasons:  The Federal Tax Reform Act of 1986 allowed you to make nondeductible contributions to your IRA even if you were unable to deduct all, part, or none of the con­ tributions. Your nondeductible contribution is the differ­ ence between your total allowable IRA contributions (up to the maximum amount) and the amount you deducted on your Alabama return that year.  Qualified contributions made by you to an indi­ vidual retirement arrangement (IRA), simplified em­ ployee pension (SEP), or Keogh plan before January 1, 1982, are considered part of your nondeductible contri­ butions since Alabama did not allow you to defer tax on these contributions.  Qualified contributions you made to a Federal 401(k)(2) plan or 403(b) plan before January 1, 1985 are considered part of your cost since Alabama did not allow you to defer tax on these contributions. Line 3. Enter the total of all amounts you have with­ drawn from these accounts and excluded from income on a previous year’s Alabama return. Line 4. Subtract line 3 from line 2 and enter the re­ sult on line 4. The difference in these amounts repre­ sents the balance of your nondeductible contributions. Page 14

Line 5. 2024 Withdrawals. Enter the total of all amounts you withdrew from your IRA or other deferred compensation accounts during the taxable year. Line 6. Exclusion Ratio. Divide the amount on line 4 by the amount on line 1. This ratio will be used to fig­ ure the amount of nondeductible contributions that may be excluded this year. Line 7. Amount of Exclusion. Multiply the amount on line 5 by the percentage on line 6. Enter the result here, but do not enter more than the amount on line 4. Line 8. Subtract the amount on line 7 from the amount on line 5. Enter amount on line 8 on Schedule RS, Part II if pri­ mary taxpayer or Part III if spouse. If you received dis­ tributions from two or more different types of accounts (IRA, SEP, Keogh, etc.), you should complete a work­ sheet for each type of account. B – Pensions, annuities, etc., you began receiving after December 31, 1986 in which you had a cost basis. Lines 9 and 10. Use these lines to report only the pensions and annuities you first began receiving in 1987 which are not fully taxable and for which you used the federal annuity tables to compute the taxable portion on your federal return. The taxable part of these pensions and annuities is computed in the same manner as figured for federal pur­ poses. If the cost basis for Alabama purposes and Fed­ eral purposes is the same, the taxable part will be the same. If the cost basis is different for Alabama, the tax­ able part will be different. For details, refer to Federal in­ structions and Federal Publication 575, Pension and Annuity Income. Enter the full amount you received on line 9 and the taxable portion on line 10. If you qualify to use the Federal Simplified General Rule, you will probably find it both simpler and more ben­ eficial than the Federal General Rule in figuring the tax­ able and nontaxable parts of your annuity. If you meet the conditions to choose the Federal Simplified General Rule, use the worksheet on this page to figure your taxable pension for 2024. In completing this worksheet, use your age at the birthday preceding your annuity starting date. Be sure to keep a copy of the completed worksheet because it will help you figure your 2024 taxable pension. C – Pensions, annuities, etc., you began receiving prior to January 1, 1987 in which you have not recovered your cost. Lines 11 and 12. Use these lines to report pensions and annuities, which are not fully taxable, that you first began receiving prior to 1987. Enter on line 11 the full amount of these pensions that you received in 2024 and your unrecovered cost on line 12. For amounts you began receiving prior to 1987, you can exclude from the taxable amount your unrecovered cost to the plan. Your cost is the amount you contributed plus the contributions your employer made on which you have already paid tax. After you recover your costs, all amounts you receive are fully taxable. Refer to the in­ structions for line 2 for information concerning amounts that are considered part of your cost basis of an IRA, SEP, Keogh, 401(k)(2), or 403(b) account. Beneficiaries. If a former employee is receiving a pension or annuity and dies after recovering all of his or her cost, the entire amount the beneficiary receives is taxable for Alabama purposes. However, if the pension or annuity was exempt under Alabama law to the former employee, it is also exempt to the beneficiary. If a former employee dies before recovering the en­ tire cost, the beneficiary should continue to report the amounts received in the same manner as reported by the former employee. If the former employee began re­ ceiving payments after De cem ber 31, 1986, the bene­ ficiary must continue to use the federal annuity tables based on the beneficiary’s life expectancy in determining the taxable part. If the deceased former employee began receiving payments before January 1, 1987, and has not recovered the cost, the beneficiary will continue to re­ cover the cost before any amounts become taxable. Line 14. Add the amounts on lines 10 and 13. If the amount on line 14 is received from IRA account or from some other type account, enter it on Schedule RS, Part II for primary taxpayer or Part III for spouse. If you received distributions from two or more different types of accounts, you should report the total of all ac­ counts on Schedule RS, Part II for primary taxpayer or Part III for spouse. Line 5 Rents, Royalties, Partnerships, Estates, Trusts, Etc. Use line 5 to report income from rents, royalties, part­ nerships, S corporations, trusts, and estates. For more information, see the instructions for Sched­ ule E. Schedule E should be completed and attached to Form 40. Line 6 Farm Income or (Loss) If you operated a farm during the year, you must at­ tach Federal Schedule F to your return. Alabama law differs from federal law in the treatment of certain items. See the instructions for line 2, Part I, for a description of the items that may need adjusting. If you have adjustments to any of these items, attach an ex­ planation, and show the adjustment as “Other Expenses” on Federal Schedule F. The net profit or (loss) from farming as shown on Federal Schedule F, after making the necessary adjust­ ments, should be entered on line 6, Part I. Line 7 Other Income Enter on line 7 any income you cannot find a place for on your return or other schedules. State the nature and source in the spaces provided, or attach a separate explanation. See below for items that should be reported under Other Income. Foreign Income Exclusion. If you are entitled to a foreign income exclusion, please attach a copy of your Federal Form 2555 to your return and report the amount of your exclusion as a credit with a negative sign (Ex­ ample: -30,000) on line 7 Other Income on page 2 of your return. All foreign income must be reported on your return in order to receive any foreign income exclusion. Nonqualified Distribution from Alabama 529 Sav­ ings Plan. If you receive a distribution from your Ala­ bama 529 Savings plan and do not use the distribution to pay qualified expenses, the amount not used for qual­ ifying expenses is taxable. Enter the amount of the non­ qualified distribution plus 10% of the distribution and description on Line 7, Other Income. Nonqualified Withdrawal from First-time Second Chance Home Buyer Savings Account Penalty. Tax­ payers must include in income the amount of any non­ qualified amounts withdrawn from their First-Time Second Chance Home Buyer Savings Account includ­ ing any interest earned on these amounts. Enter amount from Schedule HBC, Part III, Line 5 and description on Line 7, Other Income. Nonqualified Withdrawal from Catastrophe Sav­ ings Plan. Withdrawals that exceed the qualified catas­ trophe expenses during the taxable year, the amount must be included in income. Enter the amount and de­ scription on line 7, Other Income. Nonqualified Withdrawal from ABLE Savings Ac­ count. If you make a nonqualified withdrawal as defined by Internal Revenue Code (26 U.S.C 529A), the amount of the nonqualified withdrawal, plus 10 percent of the amount withdrawn, shall be taxable as income in the year of the nonqualified withdrawal. Page 2, Part II Adjustments To Income Lines 1a and 1b Individual Retirement Arrangement (IRA) Deduction Contributions to an Individual Retirement Arrange­ ment (IRA) may be taken as an adjustment to income. These contributions represent a deferral of tax on a por­ tion of your income. At the time funds are distributed from these accounts, the amount on which tax has been Page 15 Worksheet for Federal Simplified General Rule

1. Total pension received this year. Also enter this amount on Schedule RS, Part II or Part III. . . . . __________ 2. Your cost in the plan (contract), including any death benefit exclusion . . . . . . . . . . . . . . . . . . . . . . __________ 3. Age at annuity starting date: Enter: 55 and under . . . . . . . . . . . . . . . . 300 56-60 . . . . . . . . . . . . . . . . . . . . . . 260 61-65 . . . . . . . . . . . . . . . . . . . . . . 240 66-70 . . . . . . . . . . . . . . . . . . . . . . 170 71 and older. . . . . . . . . . . . . . . . . 120 __________ 4. Divide amount on line 2 by the number on line 3, and round to two decimal places. . . . . . . . . . . . . . . . . . __________ 5. Multiply line 4 by the number of months for which this year’s payments were made . . . . . . . . . . . . __________ 6. Taxable pension for year. Sub tract line 5 from line 1 (do not enter less than zero). Also, enter this amount on Schedule RS, Part II or Part III. If your Form 1099R shows a larger taxable amount, use the amount on this line instead of the amount from the Form 1099R . . . . . . . . . . . . . . . . __________

deferred cannot be claimed as a cost basis in the fund. Since the Alabama Income Tax Law prior to 1982 did not allow these contributions to be deducted from gross income, you may have a cost basis in the fund for amounts contributed prior to 1982. Accurate records should be kept of the amounts contributed in order for you to be able to determine your cost basis when the funds are withdrawn. Use the worksheet in your Federal Form 1040 line- by-line instructions to calculate the amount allowable. The amount deductible on your Alabama return is sub­ ject to the same limitations as allowable on your 2024 Federal return. However, when figuring the limitation on the amount deductible use the adjusted gross income shown on line 10 of your Alabama return without bene­ fit of the IRA deduction. Line 2 Keogh Retirement Plan and SEP Deduction Self-employed individuals may deduct contributions to a Keogh plan from gross income. These contributions represent a deferral of tax on a portion of income. The al­ lowable contributions also include those qualified contri­ butions made under a Simplified Employee Pension (SEP) Plan. At the time funds are distributed from these accounts, the amount on which tax has been deferred cannot be claimed as a cost basis in the fund. Since the Alabama Income Tax Law prior to 1982 did not allow these contributions to be deducted from gross income, you may have a cost basis in the fund for amounts contributed prior to 1982. Accurate records should be kept of the amounts contributed in order to de­ termine your cost basis when the funds are withdrawn. Line 3 Penalty on Early Withdrawal of Savings The Form 1099-INT given to you by your bank or savings and loan association will show the amount of any penalty charged because you withdrew funds from a time savings deposit before its maturity. Enter this amount on line 3. (Be sure to include the interest income on Form 40, page 1, line 6.) Penalties on early with­ drawal from retirement plans are not deductible. Line 4 Alimony Paid You can deduct payments of alimony or separate maintenance made under a court decree to the same extent allowed for federal income tax purposes. Do not deduct lump-sum cash or property settlements, volun­ tary payments not made under a court order or a written separation agreement, or amounts specified as child support. The name, social security number, and address of the person receiving the payments should be shown in the space provided. Line 5 Adoption Expenses Beginning January 1, 1991, the reasonable medical and legal expenses paid or incurred by the taxpayer in connection with the adoption of a minor may be de­ ducted as an adjustment to income. The term “medical expenses” include any medical and hospital expenses of the adoptee and the adoptee’s biological mother which are incident to the adoptee’s birth, and subsequent medical care and which, in the case of the adoptee, are paid or incurred before the petition is granted. Adoption agency fees are not deductible. The expenses allowed on your 2024 return are lim­ ited to those expenses paid or incurred on or after Jan­ uary 1, 2024, even though adoption proceedings may have begun before this date. A resident of Alabama for only a part of 2024 may deduct only those expenses paid or incurred while a resident of Alabama. Accurate records of all expenses claimed as an adjustment to in­ come must be maintained by the taxpayer and be avail­ able to the Alabama Department of Revenue upon request. Line 6 Moving Expenses Certain active duty Armed Forces members may deduct certain moving expenses as an adjustment to gross income to the same extent and subject to the same limitations as currently allowed under federal rules with the following exception: The new job location must be within the State of Alabama. If you meet the requirements complete and attach Federal Form 3903 to figure the amount of moving ex­ penses. Enter the total and the new job location as indi­ cated on line 6. Line 7 Self-employed Health Insurance Deduction You can deduct self-employed health in sur ance pre­ miums to the same extent as allowed for federal purposes. Line 8 Alabama College Counts 529 Fund or Alabama Prepaid Affordable College Tuition Program (PACT) Deduction You can deduct up to $5,000 or $10,000 if married fil­ ing joint, per year for contributions to the Alabama Col­ lege Counts 529 Fund or to the Prepaid Affordable College Tuition Program (PACT). Line 9 Health Insurance Premium Deduction Alabama resident taxpayers may deduct from Ala­ bama gross income 100 percent of the amounts that they pay as health insurance premiums as part of an em­ ployer provided health insurance plan who are employed by an employer that has less than 25 employees and earns no more than $50,000 of wages and reports no more than $75,000 of adjusted gross income on their Alabama individual income tax return or $150,000 if mar­ ried filing joint. Line 10 Expenses to Retrofit/Upgrade Home to Resist Wind or Flood Damage Alabama residents may deduct from gross income the lesser of 50 percent of the cost or $3,000 to retrofit or upgrade their home to resist wind or flood damage. The taxpayer must have a certification as prescribed under Chapter 31D, Title 27, Code of Alabama 1975 or the Alabama Residential and Energy Codes Board. Line 11 Deposits to a Catastrophe Savings Account Alabama residents may deduct from gross income deposits made to a catastrophe savings account. The deduction is $2,000 if the insurance deductible is equal to or less than $1,000. If the deductible is greater than $1,000 the amount of the deduction is the lesser of $15,000 or twice the amount of the insurance deductible. If the taxpayer is self-insured and chooses not to obtain insurance then the deduction is the lesser of $250,000 or the value of the taxpayer’s legal residence. Line 12 Contributions to a Health Savings Account (HSA) Alabama residents may deduct from gross income deposits made to a health saving account. The HSA contributions are defined as contributions made by a tax­ payer to his or her HSA up to the maximum amount al­ lowed pursuant to 26 USC §223. Any contributions made to a heath savings account using pre-tax dollars are not deductible. Line 13 Deposits to an Alabama First-Time and Second Chance Home Buyer Savings Account Alabama residents who have not owned or pur­ chased individually or jointly a home ten years prior to the purchase of the first-time home in Alabama may now take a deduction for contributions made to a first-time and second chance home buyer savings account. Indi­ viduals must open an account with a financial institution which is designated as a first-time and second chance home buyer savings account on or after January 1, 2019. Only the account holder(s) are eligible for a deduction. Individuals or organizations that contribute to an account on behalf of the taxpayer will not be eligible for any de­ ductions for the contribution. The funds must be used by December 31st of the tenth year to purchase a home in Alabama or the entire funds balance must be included in the account holder’s income. Taxpayers must maintain and submit annually with their return any supporting doc­ umentation provided by the financial institution for the account. Funds withdrawn for reasons other than to pur­ chase a first-time home will require the taxpayer to in­ clude in income non-qualified withdrawals in which a deduction was claimed, and any interest earned on the account which was excluded from income on a prior year(s) tax return in the year of withdrawal. A penalty equal to 10% of the non-qualified amounts withdrawn is also charged. Any earnings on the account are not tax­ able if used for the purchase of a first home in Alabama. Schedule HBC is required to be submitted with the Form 40 if the taxpayer is claiming a deduction for deposits made to these account(s) or excluding interest earned in these account(s). It is also used to report withdrawals and compute penalty for nonqualified withdrawal. Line 14 Certified Firefighter Insurance Premiums Effective with tax year 2020, certified Alabama fire­ fighters may deduct 100 percent of insurance premiums Page 16

paid for cancer insurance coverage as defined in Act 2019-361, provided the premiums have not been de­ ducted from federal gross income or are deductible under any other law. Insurance premiums paid with pre- tax dollars will not be deductible. Line 15 Contributions to an Achieving a Better Life Experience (ABLE) savings ac­ count Act 2021- 514 allows an individual taxpayer to deduct contributions made on or after January 1, 2021 to an Ala­ bama ABLE savings account, by or on behalf of such in­ dividual, of an amount up to five thousand dollars ($5,000) per year. Page 2, Part III Dependents Before completing this section, see page 8 of these instructions for the definition of a dependent. Schedule DS must be finished first and attached to your return to take the deduction for dependents. Please follow the line-by-line instructions on Form 40 to complete this section. NOTE: If you used Federal Form 8332 (Release/Revo­ cation to claim exemption for child by custodial parent), or if you are NOT claiming a dependent as a dependent for this tax year – DO NOT complete column “Do you provide more than one-half dependents support” on Schedule DS. Page 2, Part IV General Information ALL TAXPAYERS MUST COMPLETE THIS SECTION Line 1 Check the appropriate block for either full-year or part-year residency status. Full-Year Resident. Check here if you were a legal resident of Alabama even if you were employed outside Alabama. Part-Year Resident. Check here if you were not a legal resident of Alabama for the entire year. (Example: During 2024 you moved into Alabama and became a resident, or you moved out of Alabama and became a resident of another state.) Line 4 Enter the Adjusted Gross Income and Taxable In­ come as reported on your 2024 Federal Income Tax Re­ turn. This information is required under Section 40-18-56, Code of Alabama 1975. Line 5 If you received income from sources taxable for Fed­ eral purposes but exempt for Alabama tax purposes, the source(s) and amount(s) should be entered on line 5 un­ less they are explained elsewhere on the Alabama return. EXAMPLE: U.S. Civil Service Retirement is exempt for Alabama purposes and therefore should be shown on line 5. Direct Deposit Information In order to receive a direct deposit refund, your Form 40 return must be electronically filed, paper filed using tax preparation software that utilized 2-D barcode tech­ nology, or a fill-in Form 40 with calculations from our website.

NOTE: You cannot use the blank Form 40 to receive a direct deposit refund.

WARNING: Due to changes in the electronic banking rules, the Alabama Department of Revenue will no longer allow direct deposits to or through foreign finan­ cial institutions. If you use a foreign financial institution, you will be issued a paper check. Line 1 The routing number must be nine digits. The first two digits must be 01 through 12 or 21 through 32. Oth­ erwise, the direct deposit will be rejected and a check sent instead. Your check may state that it is payable through a financial institution different from the one at which you have your checking account. If so, do not use the routing number on that check. Instead, contact your financial institution for the correct routing number to enter on line 1a. Line 3 The account number can be up to 17 characters (both numbers and letters), to include hyphens but omit spaces and special symbols. Enter the number from left to right and leave any unused boxes blank. Be sure not to include the check number. WARNING: Some financial institutions will not allow a joint refund to be deposited into an individual account. If the direct deposit is rejected, a check will be sent in­ stead. The Department is not responsible if a financial in­ stitution rejects a direct deposit. If you are unsure of the routing number and/or account number, you should check with your financial institution to ensure they are correct. The Department is not responsible for a lost re­ fund if you enter the wrong account information.

SECTION General 4 Information

This section contains general information about items such as amending your tax return, how long to keep records, and filing a return for a deceased person. Substitute Tax Forms You may not use your own version of a tax form un­ less it meets the requirements of the Alabama Depart­ ment of Revenue. All privately designed and printed substitute tax forms must be approved by the Alabama Department of Revenue. Penalties and Interest Interest. Interest is charged on taxes not paid by their due date even if an extension of time is granted. If your return is not filed by the due date and you owe ad­ ditional tax, you should add interest from the due date of the federal return to date of payment. Submit payment of the tax and interest with your return. Alabama law pro­ vides that the same rate of interest shall be collected as currently prescribed by the Internal Revenue Service. Any of the Alabama Tax payer Service Centers listed on page 3 of this book let will provide the current rate of in­ terest in effect at the time your return is filed. Failure To Timely File Return. Alabama law pro­ vides a penalty of 10% of the tax due or $50, whichever is greater, if filed late. The penalty does not apply to a tax return filed indicating no tax due or a refund. Failure To Timely Pay Tax. The penalty for not pay­ ing the tax when due is 1% of the unpaid amount for each month or fraction of a month that the tax remains unpaid. The maximum penalty is 25%. Underpayment Penalty. If the amount of tax due for 2024 is $500 or more you may owe a penalty due to un­ derpayment if the total of your withholding and timely es­ timated tax payments did not equal at least the smaller of: 1. 90% of your 2024 tax (66-2/3% for farmers), or 2. 100% of your 2023 tax. (Your 2023 tax return must be for a 12-month period.) Use Form 2210AL to calculate the penalty. Also see Payment of Estimated Tax on this page. NOTE: If you included interest, a failure to timely file, or a failure to timely pay penalty with your payment, iden­ tify and enter these amounts in the bottom margin of Form 40, page 1. Other Penalties. There are also penalties for filing a frivolous return, underpayment due to negligence, un­ derpayment due to fraud, substantial understatement of estimated tax, and failure to file estimated tax. Any person failing to file a return as required by Ala­ bama law or rendering a willfully false or fraudulent re­ turn will be assessed by the Alabama Department of Revenue on the basis of the best information obtainable by the Department with respect to the income of such taxpayer. Criminal Liability. Section 40-29-112, Code of Ala­ bama 1975, as amended, provides for a more severe penalty for not filing tax returns. Any person required to file a return under this title who willfully fails to make such return shall be guilty of a misdemeanor and upon con­ viction thereof, shall be fined not more than $25,000 or imprisoned not more than 1 year, or both. Section 40- 29-110 provides that any person who willfully attempts to evade any tax imposed by this title or the payment thereof shall be guilty of a felony and, upon conviction thereof, shall be fined not more than $100,000 or im­ prisoned for not more than 5 years, or both. These penal­ ties are in addition to any other penalties provided for by Alabama law. Address Change If you move after filing your return you should notify the Department of Revenue by sending a Change of Ad­ dress Form available on the Department’s website under the Forms link to: Alabama Department of Revenue Income Tax Administration Division P.O. Box 327410 Montgomery, AL 36132-7410 Page 17

Corresponding With Alabama Department of Revenue Be sure to include your social security number and phone number in any letter to the Alabama Depart ment of Revenue. (See “Where To File,” page 12.) How Long Should Records Be Kept? Keep records of income, deductions, and credits shown on your return, as well as any worksheets used to figure them, until the statute of limitations runs out for that return. Usually this is 3 years from the date the re­ turn was filed. If income that should have been reported was not reported and the income omitted is in excess of 25% of the stated income, the period of limitation does not expire until six (6) years after the due date of the re­ turn or six (6) years after the date the return was filed, whichever is later. There is no period of limitation when a return is false or fraudulent, or when no re­ turn is filed. Also keep copies of your filed tax returns as part of your records. You should keep some records longer than the period of limitation. For example, keep property records (including those on your own home) as long as they are needed to figure the basis of the original or re­ placement property. Copies of your tax returns will help in preparing future returns, and they are necessary if you file an amended return. Copies of your returns and your other records may be helpful to your survivor, or the ex­ ecutor or administrator of your estate. Requesting a Copy of Your Tax Return If you need a copy of your tax return or tax account information use Form 4506-A, Request for Copy of Tax Form or Income Tax Account Information. The charge for a copy of a return is $5. There is no charge for tax ac­ count information. Amended Return If you have already filed a return and become aware of any changes to income, deductions or credits, you should file an amended tax return. You should file a com­ pleted Alabama Individual Income Tax Return with the “Amended” box checked. A detailed explanation page of all the changes made should be attached to the tax return. NOTE: If your State return is changed for any reason, it may affect your Federal Income Tax liability. This would include changes made as a result of an examination of your return by the Alabama De part ment of Revenue. Contact the Internal Revenue Service for more information. Death of Taxpayer If a taxpayer died before filing a return, the taxpayer’s spouse or personal representative must file a return for the person who died if they were required to file a return. A personal representative can be an executor, adminis­ trator, or anyone who is in charge of the taxpayer’s property. The person who files the return should check the box indicating which taxpayer is deceased and provide the date of death in the space provided. A copy of the death certificate must also be attached to the return. If the taxpayer did not have to file a return but had tax withheld, a return must be filed to receive a refund. If your spouse died within the tax year, you can file a joint return even if you did not remarry. You can also file a joint return if your spouse died before filing the re­ turn. A joint return should show both your and your spouse’s income during the tax year. Also, write “Filing as surviving spouse” in the area where you sign the re­ turn. If someone else is the personal representative, he or she must also sign. If you are claiming a refund as a surviving spouse fil­ ing a joint return with the deceased and you follow the above instructions, no other form is needed unless you receive a joint refund check and the refund check should be reissued in your name only. In such case, you will need to file Form 1310A. Form 1310A is used when you are a surviving spouse requesting reissuance of the refund check in your name only, a court-appointed or certified personal representative and did not file paperwork with decedent’s original return, or any other person claiming the refund for the decedent or on behalf of the decedent’s estate. Payment of Estimated Tax Every individual who reasonably expects to owe at least $500 in tax in 2025 is required to file and pay esti­ mated tax. NOTE: If the TOTAL ESTIMATED TAX for 2025 is less than five hundred dollars ($500), an estimate is not re­ quired to be paid. Alabama law provides for penalties if an estimate is due and is not paid, or is underpaid. The due dates for making estimated tax payments are the same as re­ quired by Federal Income Tax Law. Do not include pay­ ment of your estimated tax with the payment for tax due on your individual return because the quarterly voucher and remittance MUST be mailed separately. Additional instructions for filing your estimates are on the back of Form 40ES. No refund will be made for any estimated taxes paid except when such amount is taken as a credit on an in­ come tax return filed at the end of the taxable year by the payor or his authorized representative, or on an amended income tax return if the full amount paid is not claimed on the original income tax return. Automatic Extension If you know you cannot file your return by the due date, you do not need to file for an extension. You will automatically be granted an extension until October 15, 2025. If you anticipate that you will owe additional tax on your return, you should submit your payment with a pay­ ment voucher (Form 40V) by the due date of your federal return. Except in cases where taxpayers are abroad, no ex­ tension will be granted for more than 6 months. An extension means only that you will not be as­ sessed a penalty for filing your return after the due date. Interest on the additional tax due from the due date of the return and any penalties will be assessed if applicable to your return. Setoff Debt Collection If you owe money or have a delinquent account under any of the following public assistance programs, your refund may be applied to offset that debt:  Any and all of the public assistance programs ad­ ministered by the Alabama Department of Human Re­ sources, including the Child Support Act of 1979, Chap­ ter 10 of Title 38.  Any and all of the assistance programs adminis­ tered by the Alabama Medicaid Agency.  Overpayment of unemployment compensation.  Any and all unpaid debt submitted by local gov­ ernmental entities.  Any and all court fees/fines owed to the Adminis­ trative Office of Courts. If the Alabama Department of Human Resources, the Alabama Department of Labor, the Administrative Office of Courts, the Alabama Medicaid Agency, Ala­ bama League of Municipalities, or Association of County Commissions of Alabama notifies the Alabama Depart­ ment of Revenue that you have a delinquent account in excess of $25, part or all of your refund may be applied to offset that debt. If you are married and filing a joint re­ turn, the joint refund may be applied to offset any of the above debts. IMPORTANT: If you have been assessed taxes from a prior year, your current year refund will be applied to that debt even if the liability resulted from a jointly filed return. Federal Refund Offset Program Your 2024 federal or state refund will be taken to sat­ isfy any outstanding liabilities owed to the State of Ala­ bama or to the Internal Revenue Service.

SECTION Instructions to 5 Schedules for Form 40

Instructions For Schedule A (Form 40) Itemized Deductions Changes You Should Note The itemized deductions you may claim on your Ala­ bama return are similar to the deductions allowed for Federal purposes; however, certain items may be treated differently. Please see the line by line instruc­ tions which follow for an explanation of these differences. Purpose of Schedule Some taxpayers should itemize their deductions be­ cause they will save money. See Itemized or Standard Deduction on page 8. Schedule A must be completed in detail if you elect to itemize your deductions instead of claiming the stan­ dard deduction. If you itemize, you can deduct part of your medical and dental expenses, part of your unreimbursed em­ ployee business expenses, amounts you paid for certain taxes, interest, contributions, and other miscellaneous expenses. You may also deduct certain casualty and theft losses. Married, Filing Separate Returns. If married and fil­ ing separate returns, both spouses must claim the same deduction unless the spouses have lived apart for the Page 18

entire year, in which case each spouse may claim either deduction. However, neither spouse may claim a de­ duction for expenses paid by the other. Part-year Residents. Individuals becoming or ceas­ ing to be residents during the year are entitled to claim ONLY the itemized deductions that were actually paid while a resident of Alabama. The Department will per­ mit you to prorate a deduction (such as interest or taxes) based on the number of months you were a resident if the deduction was paid during the entire year and the amount actually paid while a resident cannot be determined. Lines 1 through 4 Medical and Dental Expenses Before you can figure your total medical and dental expenses, you must complete your Form 40, page 1, lines 1 through 10. Medical and dental expenses are allowed as item­ ized deductions to the same extent as allowed for federal purposes with the following exceptions:  Do not include in medical and dental expenses insurance premiums paid by an employer-sponsored health insurance plan (cafeteria plan).  You may deduct only that part of your medical and dental expenses that is more than 4% of the amount on Form 40, page 1, line 10.  Qualified long term care premiums are not in­ cluded in medical and dental expenses. They are de­ ductible in full on line 26. Enter the total of your medical and dental expenses after reducing these expenses by any payments re­ ceived from insurance or other sources. Include amounts you paid for doctors, dentists, nurses, hospitals, pre­ scription medicines and drugs, or insulin. Also, include the total amount you paid for insurance premiums for medical and dental care, amounts paid for transporta­ tion and lodging, and other expenses such as hearing aids, dentures, eyeglasses, and contact lenses. If your insurance company paid your doctor or den­ tist directly for part of your medical expenses and you paid only the amount that remained, include in your med­ ical expenses ONLY the amount you paid. If you received a reimbursement in 2024 of prior year medical or dental expenses, do not reduce your 2024 expenses by this amount. You must include the reim­ bursement in income on Form 40, Part 1, line 8, if you deducted the medical expenses in the earlier year and the deduction reduced your tax. Federal Pub. 502 tells you how to figure the amount to include in income. When figuring the deduction, you may include med­ ical and dental bills you paid for:  Yourself.  Your spouse.  All dependents claimed on your return.  Your child whom you do not claim as a depend­ ent because of the federal rules explained for Children of Divorced or Separated Parents. Examples of Medical and Dental Payments You CAN Deduct To the extent you were not reimbursed, you can deduct what you paid for:  Medicare Part B insurance.  Prescription medicines and drugs, or insulin.  Premiums paid to private insurers for additional Medicare coverage.  Medical doctors, dentists, eye doctors, chiro­ practors, osteopaths, podiatrists, psychiatrists, psychol­ ogists, physical therapists, acupuncturists, and psy cho analysts (medical care only).  Medical examinations, X-ray and laboratory serv­ ices, insulin treatment, and whirlpool baths the doctor ordered.  If you pay someone to do both nursing and housework, you can deduct only the cost of the nursing help.  Hospital care (including meals and lodging), clinic costs, and lab fees.  Medical treatment at a center for drug addicts or alcoholics.  Cost of a weight-loss program for the purpose of treating diagnosed obesity or another recognized dis­ ease. Cost must be out-of-pocket and uncompensated.  Medical aids such as hearing aid batteries, braces, crutches, wheelchairs, guide dogs, and the cost of maintaining them.  Lodging expenses (but not meals) paid while away from home to receive medical care in a hospital or a medical care facility that is related to a hospital. Do not include more than $50 a night for each eligible person.  Ambulance service and other travel costs to get medical care. If you used your own car, you can claim what you spent for gas and oil to travel to and from the place you received medical care, or you can claim the federal mileage rate. Add parking and tolls to the amount you claim under either method. Examples of Medical and Dental Payments You CANNOT Deduct  Premiums paid by an employer-sponsored health insurance plan (cafeteria plan).  The basic cost of Medicare insurance (Medicare Part A). NOTE: If you were 65 or older but not entitled to social security benefits, you may deduct premiums you volun­ tarily paid for Medicare A coverage.  Life insurance or income protection policies.  The 1.45% Medicare (hospital insurance bene­ fits) tax withheld from your pay as part of the social se­ curity tax or the Medicare tax paid as part of social security self-employment tax.  Nursing care for a healthy baby.  Illegal operations or drugs.  Nonprescription medicines or drugs.  Travel your doctor ordered for rest or change.  Funeral, burial, or cremation costs. Federal Pub. 502 has a discussion of expenses that may and may not be deducted. It also explains when you may deduct cap­ ital expenditures and special care for handicapped persons. Lines 5 through 9 Taxes (Other than Federal Income Tax) You CAN Deduct If deductions are itemized, you CAN DEDUCT the following taxes:  Real Estate Taxes (line 5). Include taxes you paid on property you own in any state that was not used for business. If you pay real estate taxes as part of your mortgage payments, do not take a deduction for that amount. Deduct the taxes in the year the mortgage com­ pany actually paid them to the taxing authority.  FICA Tax (Social Security and Medicare) (line 6). You can deduct the FICA tax (Social Security and Medicare) withheld on your income by your employer. If you worked for more than one employer which resulted in more than the maximum FICA tax being withheld, the excess amount claimed as Federal Income Tax With­ held on your Federal return cannot be claimed as an itemized deduction on your Alabama return.  Federal Self-Employment Taxes (line 6). You can deduct the Federal self-employment tax you paid during the year 2024 for the tax year 2023 and/or prior years.  Railroad Retirement Tax (line 7). You can deduct the railroad retirement tax you paid in 2024. Only your contribution to tier one railroad retirement is de­ ductible as an itemized deduction.  Other taxes (line 8). In addition to the above taxes, you can also deduct: (a) City, County, and Occupational Tax as re­ ported on your W-2. (b) State Unemployment Insurance Tax (S.U.I.). Employees were not required to pay S.U.I. Tax in 2024 since the full amount was paid by their employer. How­ ever, if S.U.I. Tax was paid to a state other than Ala­ bama, it may be deducted. (c) Federal Gift Taxes. Federal gift taxes are de­ ductible only if you are the person making the gift and you paid the tax. (The person receiving the gift cannot claim this deduction even though he paid the tax.) (d) Personal Property Taxes. This tax must be based on the value alone. For example, if part of the fee you paid for the registration of your car was based on the car’s value and part was based on its weight, you can deduct only the part based on value. (e) Generation-Skipping Transfer (GST) Taxes. Generation-skipping transfer taxes imposed on income distributions by 26 U.S.C. 2601 are deductible if you paid or accrued the taxes within the taxable year. Taxes You CANNOT Deduct include but are not limited to  State income taxes. (If you paid state income taxes to another state, you may be entitled to a tax credit. See instructions for Schedule CR for further information.)  State and local sales taxes.  Income tax you paid to a foreign country.  Taxes you paid for another person.  License fees (marriage, driver’s, dog, hunting, pistol, etc.).  Civil Service Retirement contributions (State or Federal).  Federal excise tax on personal property, trans­ portation, telephone, and gasoline.  Customs duties.  Gasoline tax.  State utility taxes.  Tax on liquor, beer, wine, cigarettes, and tobacco.  Car inspection fees.  Taxes you paid for your business or profession. (Use Schedule C, C-EZ, E, or F to deduct these busi­ ness expenses.)  Assessments for sidewalks or other improve­ ments to your property. Lines 10a through 14 Interest You Paid The interest you paid that can be claimed as an item­ ized deduction is limited in most cases to the same amount as currently allowable for federal purposes. You should show on Schedule A interest you paid on nonbusiness items only. Whether your interest ex­ pense is treated as investment interest, personal inter­ est, or business interest depends on how and when you used the loan proceeds. Page 19

NOTE: Personal interest is no longer deductible. Complete and attach Alabama Form 4952A if you are claiming investment interest as an itemized deduction. If you qualify for the Mortgage Interest Credit on your Federal return, the total interest you paid (before the credit) is deductible for Alabama purposes. For further information describing the interest you may deduct, refer to federal instructions and publications. Lines 15 through 18 Gifts to Charity Contributions are allowable as itemized deductions to the same extent as currently allowed for federal pur­ poses. However, when determining any limitations, you must use Alabama (not Federal) adjusted gross income. You can deduct what you gave to organizations that are religious, charitable, educational, scientific, or literary in purpose. You can also deduct what you gave to or­ ganizations that work to prevent cruelty to children or animals. Note: See Federal Pub. 526 for more information Examples of these organizations are:  Churches, temples, synagogues, Salvation Army, Red Cross, CARE, Goodwill Industries, United Way, Boy Scouts, Girl Scouts, Boys and Girls Clubs of America, etc.  Fraternal orders if the gifts will be used for the purposes listed above.  Veteran’s and certain cultural groups.  Nonprofit schools, hospitals, and organizations whose purpose is to find a cure for, or help people who have arthritis, asthma, birth defects, cancer, cerebral palsy, cystic fibrosis, diabetes, heart disease, hemo­ philia, mental illness or retardation, multiple sclerosis, muscular dystrophy, tuberculosis, etc.  Federal, state, and local governments if the gifts are solely for public purposes. If you contributed to a charitable organization and also received a benefit from it, you can deduct only the amount that is more than the benefit you received. If you do not know whether you can deduct what you gave to an organization, check with that organization or with the IRS. Contributions You MAY Deduct Contributions may be in cash (keep canceled checks, receipts, or other reliable written records show­ ing the name of the organization and the date and amount given), property, or out-of-pocket expenses you paid to do volunteer work for the kinds of organizations described above. If you drove to and from the volunteer work, you may take 14 cents a mile or the actual cost of gas and oil. Add parking and tolls to the amount you claim under either method. (But don’t deduct any amounts that were repaid to you.) You MAY NOT Deduct as Contributions  Travel expenses (including meals and lodging) while away from home unless there was no significant el­ ement of personal pleasure, recreation, or vacation in the travel.  Political contributions.  Dues, fees, or bills paid to country clubs, lodges, fraternal orders, or similar groups.  Value of any benefit such as food, entertainment, or merchandise that you received in connection with a contribution to a charitable organization. Example. You paid $100 to a charitable organiza­ tion to attend a fund-raising dinner. To figure the amount of your deductible charitable contribution, sub tract the value of the dinner from the total amount you paid. If the value of the dinner was $40, your deductible contribu­ tion is $60.  Cost of raffle, bingo, or lottery tickets.  Cost of tuition.  Value of your time or services.  Value of blood given to a blood bank.  The transfer of a future interest in tangible per­ sonal property (generally, until the entire interest has been transferred).  Gifts to: a. Individuals. b. Foreign organizations. c. Groups that are run for personal profit. d. Groups whose purpose is to lobby for changes in the laws. e. Civic leagues, social and sports clubs, labor unions, and chambers of commerce. Record Keeping. If you gave property, you should keep a receipt or written statement from the organiza­ tion you gave the property to, or a reliable written record that shows the organization’s name and address, the date and location of the gift, and a description of the property. You should also keep reliable written records for each gift of property that include the following information: a. How you figured the property’s value at the time it was given. (If the value was determined by an appraisal, you should also keep a signed copy of the appraisal.) b. The cost or other basis of the property if you must reduce it by any ordinary income or capital gain that would have resulted if the property had been sold at its fair market value. c. How you figured your deduction if you chose to re­ duce your deduction for gifts of capital gain property. d. Any conditions attached to the gift. NOTE: If your total deduction for gifts of property is over $500, or if you gave less than your entire interest in the property, or you made a “qualified conservation contri­ bution” under Federal Section 170(h), your records should contain additional information. See Federal Pub. 526 for details. Line 15 Enter the total contributions you made in cash or by check (including out-of-pocket expenses). Line 16 Enter the contributions of property. If you gave used items such as clothing or furniture, deduct their fair mar­ ket value at the time you gave them. Fair market value is what a willing buyer would pay a willing seller when neither has to buy or sell and both are aware of the con­ ditions of the sale. If the amount of your deduction is more than $500, you must complete and attach Federal Form 8283, Noncash Charitable Contributions. If your total deduction is over $5,000, you may also need ap­ praisals of the values of the donated property. For this purpose, the “amount of your deduction” means your de­ duction BEFORE applying any income limitations that could result in a carryover of contributions. See Federal Form 8283 and its instructions for details. Line 17 Enter on line 17 any carryover of contributions that you were unable to deduct in an earlier year because it exceeded your adjusted gross income limit. Lines 19a, b, and c Casualty and Theft Losses A casualty or theft loss is determined in the same manner as on your federal return with the following exceptions:  The loss may be claimed only in the year during which the loss occurred or the theft was discovered.  The loss on personal property must be reduced by 10% of the Alabama adjusted gross income as shown on Form 40, page 1, line 10. Use lines 19a, b, and c to report casualty or theft losses of property that are not a trade or business, in­ come-producing, or rent or royalty property. Complete and attach Federal Form 4684 to figure your loss. Enter on line 19a of Alabama Schedule A the amount of loss as shown on line 15 or line 16 (Section A) of Form 4684. Losses You MAY Deduct You may be able to deduct all or part of each loss caused by theft, vandalism, fire, storm, and car, boat, and other accidents or similar causes. You may also be able to deduct money you had in a financial institution but lost because of the insolvency or bankruptcy of the institution. You may deduct nonbusiness casualty or theft losses only to the extent that — a. the amount of EACH separate casualty or theft loss is more than $100, and b. the total amount of ALL losses during the year is more than 10% of your adjusted gross income on Form 40, page 1, line 10. Special rules apply if you had both gains and losses from nonbusiness casualties or thefts. Get Federal Form 4684 for details. Losses You MAY NOT Deduct  Money or property misplaced or lost.  Breakage of china, glassware, furniture, and sim­ ilar items under normal conditions.  Progressive damage to property (buildings, clothes, trees, etc.) caused by termites, moths, other in­ sects, or disease. Use line 21 of Schedule A to deduct the costs of proving that you had a property loss. (Examples of these costs are appraisal fees and photographs used to es­ tablish the amount of your loss.) For more details, refer to federal instructions and publications. Lines 20 through 24 Miscellaneous Deductions Expenses Subject to the 2% Limit Most miscellaneous deductions cannot be deducted in full. You must subtract 2% of your Alabama adjusted gross income from the total. You figure the 2% limit on line 23. Generally, the 2% limit applies to job expenses you paid for which you were not reimbursed (line 20). The limit also applies to certain expenses you paid to pro­ duce or collect taxable income (line 21). See the in­ structions for lines 20 and 21 for examples of expenses to deduct on these lines. The 2% limit does not apply to certain other miscel­ Page 20

laneous expenses that you may deduct. See the in­ structions for line 25 for examples of these expenses. Line 20 Use this line to report Alabama job expenses you paid for which you were not reimbursed. In some cases, you must first fill out Federal Form 2106, Employee Business Expenses. Fill out Form 2106 if: 1. You claim any travel, transportation or meal ex­ penses for your job; OR 2. Your employer paid you for any of your job ex­ penses reportable on line 20. If 1 or 2 above applies, enter the net deductible amount from Federal Form 2106 on line 20 of Schedule A. If you do not have to fill out Form 2106, list the type and amount of your expenses on the space provided on line 20. If you need more space, attach a statement showing the type and amount of the expense. Examples of expenses to include on line 20 are:  Travel, transportation or meal expense. Note: If you have any of these expenses, you must use Federal Form 2106 for all your job expenses.  Union dues.  Safety equipment, small tools, and supplies you used in your job.  Uniforms your employer said you must have and which you may not usually wear away from work.  Protective clothing required in your work such as hard hats, safety shoes, and glasses.  Physical examinations your employer said you must have.  Dues to professional organizations and chambers of commerce.  Subscriptions to professional journals.  Fees to employment agencies and job search ex­ penses in your present occupation.  Education expenses you paid that were required by your employer, or by law or regulations, to keep your salary or job. In general, you may include the cost of keeping or improving skills you must have in your job. Some educational expenses are not deductible. See Ex­ penses You MAY NOT Deduct.  Business use of part of your home, but ONLY if you use that part exclusively and on a regular basis in your work and for the convenience of your employer. For details, including limits that apply, see Federal Pub. 587, Business Use of Your Home. Also, see the instructions for Part I, line 2 on page 13. Line 21 Use this line for amounts you paid for the production or collection of taxable income; for the management, conservation, or maintenance of property held for the production of taxable income; or in connection with the determination, collection, or refund of any tax. List the type and amount of each expense in the space provided on line 21. If you need more space, attach a statement showing the type and amount of each expense. Enter one total in the amount space for line 21. Examples of these expenses are:  Tax return preparation fee.  Safe deposit box rental.  Certain legal and accounting fees.  Clerical help and office rent.  Custodial (e.g., trust account) fees.  Your share of the investment expenses of a regulated investment company.  Certain losses on nonfederally insured deposits in an insolvent or bankrupt financial institution. For more information (including limits on the amount you can deduct), see Federal Pub. 529.

NOTE: Excess deductions from decedent’s estate and ir­ revocable trust cannot be claimed. See Code of Ala­ bama 40-18-25(4). Line 25 Miscellaneous Deductions Expenses NOT Subject to the 2% Limit Use this line to report miscellaneous deductions that are NOT subject to the 2% AGI limit. Only the expenses listed below can be deducted on line 25:  Gambling losses to the extent of gambling win­ nings. Report gambling winnings on Form 40, page 2, Part I, Line 7.  Amortizable bond premium on bonds acquired before October 23, 1986.  Unrecovered investment in a pension. See Fed­ eral Pub. 17.  Impairment-related work expenses of a disabled person. List the type and amount of each expense. Enter the total on line 25. Expenses You MAY NOT Deduct Some expenses are not deductible at all. Examples are:  Political contributions.  Personal legal expenses.  Lost or misplaced cash or property (but see Ca­ sualty and Theft Losses).  Expenses for meals during regular or extra work hours.  The cost of entertaining friends.  Expenses of going to or from work.  Education that you need to meet minimum re­ quirements for your job or that will qualify you for a new occupation.  Expenses of: a. Travel as a form of education. b. Attending a seminar, convention, or similar meeting unless it is related to your employment.  Fines and penalties.  Funeral expenses. Line 26 Qualified Long-term Care Coverage Premiums paid pursuant to a qualifying insurance contract for qualified long term care coverage paid by the taxpayer may be deducted on line 26. Qualified long- term care services include care for necessary diagnos­ tic, preventive, therapeutic and rehabilitative services and maintenance or personal care services which are required by a chronically ill individual in a qualified facil­ ity or services which are provided pursuant to a place of care prescribed by a licensed health care practitioner.

Instructions For Schedule B Interest and Dividend Income Purpose of Schedule Use Schedule B if you are filing Form 40 and the total taxable and nontaxable income from interest and divi­ dends is $1,500 or more. Mutual Funds. If you received a 1099-DIV, 1099- INT or substitute statement from a brokerage firm or mu­ tual fund, include the interest and dividends on Schedule B. Capital gains should be reported on Schedule D. List the mutual fund or brokerage firm’s name as the payer and enter the total interest or dividends shown on that form on Schedule B. Interest Income All interest you received in 2024 is taxable for Ala­ bama purposes except interest on obligations of the United States or its possessions, and interest on obliga­ tions of the State of Alabama or any county, municipal­ ity, or other political subdivision of Alabama. Show the name of the payer and the amount of all in­ terest you received on Schedule B. Exempt interest should be listed in Column A and taxable interest in Col­ umn B. Examples of TAXABLE Interest  Accounts (including certificates of deposit and money market accounts) with banks, credit unions, and savings and loan associations.  The percentage of dividends not derived from interest on United States obligations and/or Alabama municipal obligations which are received from a regu­ lated investment company.  Asian Development Bank.  African Development Fund.  Building and loan accounts.  Federal Home Loan Mortgage Corporation.  Federal National Mortgage Association (FNMA).  Government National Mortgage Association (GNMA).  Inter-American Bank, International Bank for Re­ construction and Development, and World Bank.  International Finance Corporation.  International Development Association.  International Monetary Fund.  National Consumer Cooperative Bank.  Refunds of federal income tax.  Refunds of state income tax.  Federal Land Credit Banks.  Federal Housing Authority.  Small Business Association. Examples of EXEMPT Interest  The percentage of dividends derived from inter­ est on United States obligations and/or Alabama mu­ nicipal obligations which are received from a regulated investment company.  Bank for Cooperatives.  Student Loan Marketing Association (SLMA).  Bonds issued by the Government of Puerto Rico or the Government of Guam.  Bonds issued by the government of the Virgin Islands  Federal Financing Bank.  Federal Land Banks.  Federal Intermediate Credit Banks.  Federal Home Loan Banks.  Production Credit Associations.  U.S. Treasury Bills, U.S. Treasury Notes, or Page 21

U.S. Series E and H Bonds.  Tennessee Valley Authority.  Federal Farm Credit Bonds.  Federal Home Administration.  Commodity Credit Corporation.  Federal Deposit Insurance Corporation.  Federal Saving & Loan Insurance Corporation.  General Insurance Fund.  GSA Public Building Trust Participation Certificates.  Participation Certificates in the Federal Assets Financing Trust.  Special Food Service Program. Dividend Income All dividends, including liquidating dividends, you re­ ceived in 2024 are fully taxable. Gain or loss on liqui­ dating dividends should be reported on Schedule D. Dividends from savings and loan associations are also taxable. Include cash and the value of stock, property, or merchandise you received as a dividend. List the payer’s name and show the amount of in­ come. If securities are held in a brokerage account, list the name of the brokerage firm as the payer.

Instructions For Schedule CR Credit for Taxes Paid To Other States

See the general instructions for credit for tax paid to another state on page 10. Below is an example of when all of the income in the other state is not taxed on the Alabama return. In such situations, you may not be entitled to the full amount of tax paid to the other state. The following example can be used by changing the figures to fit your income and/or loss. The taxpayer is a single filing resident of Alabama and has income from wages of $66,666.67. The tax­ payer has gambling winnings of $100,000.00. The tax­ payer has substantiated gambling losses of $50,000.00 of which only $30,000.00 is allowed as a deduction on the other state’s return. Use this example to compute the income from the other state under Alabama Tax Law. (1) Income from Other State . . . . . . . . . . $100,000.00 (2) All Alabama allowed Expenses (Losses) associated with Income from Other State: (2a) Gambling Losses . . $ 50,000.00 (2b) . . . . . . . . . . . . . . . . . $ (2c) . . . . . . . . . . . . . . . . . $ (3) Add lines 2a, 2b, and 2c. . . . . . . . . . . $ 50,000.00 (4) Income from other state under Alabama Law (subtract line 3 from 1 to get the same income taxed by Alabama) . . . $ 50,000.00 (a) If the result is zero or less, STOP here, you are not due a credit against your Alabama income tax. (b) If there is no entry on line 2 above, the “taxable income” from the other state return should be entered on Schedule CR, line 1. (c) If there is an entry on line 2 above, compute the Alabama tax on the amount on line 4 using the tax tables on pages 25-30. In this example, the tax credit would be $2,463.00.

NOTE: Residents, that worked and received income/wages from a state that doesn’t have income tax, will not be eligible for the credit for taxes paid to another state. Instructions For Schedule DC Donation Check-Offs Line 1a Alabama Senior Services Trust Fund This fund will assist in the support of programs for the aging in Alabama. If you wish to make a contribution to this program, enter a dollar amount. Line 1b Alabama Arts Development Fund This fund provides for grants to tax exempt organi­ zations or associations to encourage development of quality arts activities or cultural facilities in local areas. If you wish to make a contribution to this program, enter a dollar amount. Line 1c Alabama Nongame Wildlife Fund This is a program under the jurisdiction of the Game and Fish Division of the Department of Conservation which provides management of such nongame wildlife. If you wish to make a contribution to this program, enter a dollar amount. Line 1d Child Abuse Trust Fund This fund encourages the direct provision of services to prevent child abuse and neglect. If you wish to make a contribution to this program, enter a dollar amount. Line 1e Alabama Veterans’ Program This fund provides supportive assistance through nursing and related health care for Alabama ailing and aged veterans of the armed forces who have need of special nursing and related health care services. If you wish to make a contribution to this program, enter a dol­ lar amount. Line 1f Alabama State Veterans Cemetery at Spanish Fort Foundation, Inc. Your donations to this fund will be used to promote the mission of the cemetery and support other veteran organizations, activities and programs which promote the welfare of veterans and commemorate the honor­ able service provided by veterans. If you wish to make a contribution to this fund, enter a dollar amount. Line 1g Foster Care Trust Fund The Foster Care Trust Fund provides educational, athletic, artistic, and special occasion opportunities to Alabama’s foster children. If you wish to make a contri­ bution to this fund, enter a dollar amount. Line 1h Mental Health This is a non-profit organization dedicated to the eradication of mental illness and to the improvement of the quality of life of those whose lives are affected by these diseases. Your donation to this fund will help pro­ vide unconditional support to persons experiencing men­ tal pain and those struggling toward recovery. If you wish to make a contribution to this fund, enter a dollar amount. Line 1i Alabama Breast and Cervical Cancer Research Program The University of Alabama at Birmingham’s Com­ prehensive Cancer Center is a nationally funded leader in breast and cervical research providing cutting edge clinical care to the people of Alabama. Your donation to this fund will help in the fight against breast and cervical cancer. If you wish to make a contribution to this fund, enter a dollar amount. Line 1j Alabama Military Support Foundation This fund was established to promote better relations between employers and National Guard/Reserve members. If you wish to make a contribution to this fund, enter a dollar amount. Line 1k Alabama Veterinary Medical Foundation Spay/Neuter Program This fund provides assistance to low income resi­ dents to spay or neuter their dog or cat. If you wish to make a contribution to this program, enter a dollar amount. Line 1l Cancer Research Institute This fund was established to improve cancer survival rates for patients through research aimed at increasing prevention and treatment. If you wish to make a contri­ bution to this program, enter a dollar amount. Line 1m Children First Trust Fund Your donations to this fund will go toward ensuring that all of Alabama’s children are prepared for school success and lifelong learning through voluntary, diverse, high-quality early childhood programs. If you wish to make a contribution to this program, enter a dollar amount. Line 1n State Parks Division of the Department of Conservation and Natural Resources Donations to this fund support the conservation and management of Alabama's many state parks. If you wish to make a contribution to this program, enter a dollar amount. Line 1o Department of Mental Health 2023 Donations to this program support the health and well-being of Alabamians with mental illnesses, devel­ Page 22

opmental disabilities, and substance use disorders. If you wish to make a contribution to this program, enter a dollar amount. Line 1p Alabama Medicaid Agency This fund provides medical assistance to lower in­ come children or people who may also be on Medicare, adults with disabilities, or nursing home residents. If you wish to make a contribution to this program, enter a dol­ lar amount.

Instructions For Schedule D Gain or (Loss) From Sale of Real Estate, Stocks, Bonds, Mutual Funds, Capital Gains, etc. Purpose of Schedule Use Schedule D (Form 40) to report the sale of real estate, stocks, bonds, etc. Enter all sales for the entire year if you were a resi­ dent of Alabama for the entire year. If you were a resi­ dent of Alabama for only a part of the year, you should report all sales made during your period of residence. If you sold property located in Alabama after you ceased to be a resident of Alabama, you should report the sales on Form 40NR, Nonresident Alabama Income Tax Return. Under Alabama law the entire gain is taxable, and the entire loss is deductible in the year in which it occurs. Mutual Funds. If you received a mutual fund or bro­ kerage statement reporting capital or ordinary gains, you must include these amounts on Schedule D. List the mu­ tual fund or brokerage firm’s name in Column (a) Kind of Property and the net capital or ordinary gains in Column (h), Net Profit or (Loss). Gain From Sale of a Personal Residence. If you sold your personal residence, any gain realized is tax­ able to the same extent as reported on your federal return. NOTE: A loss on the sale of a personal residence is NOT deductible. Gain or (Loss) From Sale of Business Prop er ty. If you sold business property use Schedule D to report the net gain (or loss). You should complete Federal Form 4797 and attach a copy to your Alabama return. State the following facts: (a) For real estate (in­ cluding owner-occupied residence) – location and de­ scription of land and improvements; (b) for bonds or other evidence of indebtedness – name of issuing cor­ poration, particular issue, denomination, and amount; (c) for stocks – name of corporation, class of stock, number of shares, and capital changes affecting basis (includ­ ing nontaxable distributions). If more space is needed, use separate sheets with identical columnar headings (a) through (h) inclusive. Cost or Other Basis. Act 85-515, known as the Cor­ porate Income Tax Act of 1985, conformed certain rules concerning the determination of basis in assets acquired to the federal income tax rules. The basis for computing gain or loss from the sale or other disposition of property will usually be the cost of such property. You may have to use a basis other than actual cost if you acquired the property by bequest, gift, or involuntary conversion. If you do not use cash cost, please attach an explanation of your basis. The basis of property acquired prior to December 31, 1932, shall be the fair market value on December 31, 1932. Gifts or Transfer in Trust. The basis of property ac­ quired by gift or transfer in trust depends upon the date acquired. If property was acquired by gift or transfer in trust on or after December 31, 1932 and prior to March 15, 1985, the basis shall be the fair market value on the date of acquisition. If acquired by gift on or after March 15, 1985, the basis shall be the same as it would be in the hands of the donor or the preceding owner by whom it was not ac­ quired by gift (except that if such basis is greater than the fair market value of the property at the time of the gift, then for the purpose of determining loss, the basis shall be the fair market value). If the property was acquired by a transfer in trust (other than a transfer in trust by gift, bequest, or devise) on or after March 15, 1985, the basis shall be the same as it would be in the hands of the grantor, increased in the amount of gain, or decreased in the amount of loss, recognized to the grantor of such transfer. Property Transmitted at Death. Basis shall be the fair and reasonable market value of the property at the time of death of the decedent. The value of property as of the date of the decedent’s death as appraised for the purpose of the federal estate tax or the alternate value as appraised for such purpose, whichever is applicable, shall be deemed to be its fair market value for Alabama income tax purposes. Involuntary Conversion. If a taxpayer elects to de­ termine gain under 26 U.S.C. §1033 (relating to invol­ untary conversions), the amount of gain recognized for Alabama purposes shall be determined in accordance with the same federal statute. Installment Sales. Alabama law was changed to conform the Alabama code to the federal law regarding the installment method of reporting income. For taxable years beginning after December 31, 1984, income aris­ ing from an installment sale shall be reported in accor­ dance with Internal Revenue Code Section 453 with the exception of 453(i) which deals with the recognition of recapture income. Sales of property under revolving credit plans and sales of stock, securities, and other property traded on established markets can no longer be reported on the installment method effective for sales made after 1987.

Instructions For Schedule E Supplemental Income Purpose of Schedule Use Schedule E to report income or (loss) from rents, royalties, partnerships, S corporations, estates, and trusts. Part I Rental and Royalty Income or (Loss) If you receive rent from property owned or controlled by you, or royalties from copyrights, mineral leases, and similar rights, report the total amount received in Part I, columns (A) through (C). If property other than cash was received as rent, its fair market value should be reported. Line 1. Indicate the kind of rental real estate prop­ erty you rented out (brick house, apartment complex, etc). Include the street address, city, or town, and state, and your percentage of ownership in the property if less than 100%. Line 2. Check “Yes” if you or your family used the unit this year for personal purposes more than the greater of: 14 days; or 10% of the total days it was rented to others at a fair rental price. Other wise, check “No.” Lines 3 & 4. If you receive rent from property owned or controlled by you, or royalties from copyrights, min­ eral leases, and similar rights, report the total amount received in Part I, columns (A) through (C). If property other than cash was received as rent, its fair market value should be reported. Lines 5-18. Enter your rental and royalty expenses for each property in the appropriate column. You can deduct all ordinary and necessary expenses, such as taxes, interest, repairs, insurance, management fees, and agent’s commissions. Do Not deduct the value of your own labor or amounts paid for capital investments or capital improvements. Line 20 Depreciation. A reasonable allowance for the exhaustion, wear, and obsolescence of property used in a trade or business, or of property held by the taxpayer for the production of income shall be allowed as a depreciation deduction. The allowance does not apply to inventories or stock-in-trade nor to land apart from the improvements or physical development added to it. Depreciation computed using the Accelerated Cost Recovery System for assets placed in service on or after January 1, 1981, and before January 1, 1987, in the same manner with the same limitations provided for fed­ eral income tax returns will be considered to be a “rea­ sonable allowance” for Alabama purposes. For assets placed in service after December 31, 1986, depreciation using the Modified Accelerated Cost Recovery System provided for in I.R.C. §168 (as modi­ fied by §201(a) of P.L. 99-514) will be considered a rea­ sonable allowance for depreciation. For taxable years beginning after December 31, 1989, Alabama will allow the depreciation allowed by Federal 26 U.S.C. §179. Depletion. A depletion expense deduction is allow­ able in computing net royalty income from mines, oil wells, and gas wells. In the case of oil and gas wells, the allowance for de­ pletion shall be 12 percent of the gross income from the property during the taxable year, excluding from such gross income an amount equal to any rents or royalties paid or incurred by the taxpayer in respect to the prop­ erty. Such amounts shall not exceed 50 percent of the net income of the taxpayer, computed without allowance for depletion, from the property, except that in no case shall the depletion allowance be less than the amount allowable under federal income tax law. Part II Income or (Loss) From Partnerships, S Corporations, Estates, and Trusts If you received income from a partnership, S corpo­ ration, estate, or trust, the amounts should be reported in Part II, column (j). The name and address must be given in column (g) showing the source of the income received. Check column (h), and enter the FEIN in column (i). Partnerships. A partnership does not pay income tax in the firm’s name. If you are a member of a part­ Page 23

Page 24 nership or joint venture, include in this part your share of the partnership income (whether you received it or not) or net loss (not to exceed your basis) for the part­ nership tax year that ends during the year covered by your return. You should receive a Schedule K-1 from the partnership advising you of the amount to report. S Corporations. An “Alabama S corporation” is a corporation with respect to which an election under 26 U.S.C. §1362 is in effect. If you are a shareholder of an S corporation, you should receive a Schedule K-1 from the S corporation. Report your pro rata share of the income (whether you received it or not) or net loss (not to exceed your basis) of the corporation as shown on your Schedule K-1. Information from your partnership or S corporation K-1’s should be reported as follows: Line G. Pass-through entity owners who are indi­ viduals would claim this amount on Schedule OC of Form 40 or Form 40NR. Refer to Schedule K-1 In­ structions on page 1, Line F instructions for applicable codes and ordering of credits. Line H. Pass-through entity owners that are indi­ viduals would report this amount on Schedule E of the Alabama Form 40 or Alabama Form 40NR. Line I. Pass-through entity owners that are individ­ uals would report this amount on Schedule E of the Ala­ bama Form 40 or Alabama Form 40NR. Line J. Partnerships K-1 only: Pass-through entity owners that are individuals would report this amount on Schedule E of the Alabama Form 40 or Alabama Form 40NR. Line K. Pass-through entity owners that are indi­ viduals would report this amount on the appropriate schedule of the Alabama Form 40 or Alabama Form 40NR filed by the individual, depending upon the na­ ture of the portfolio income. Accompanying the Ala­ bama Schedule K-1 should be an explanation of the different types and amounts of portfolio income mak­ ing up the amount on Line J. Line L. Pass-through entity owners that are indi­ viduals would report this amount on Schedule E of the Alabama Form 40 or Alabama Form 40NR. Line M. Pass-through entity owners that are indi­ viduals would report this amount on Schedule E of the Alabama Form 40 or Alabama Form 40NR. Line N. Pass-through entity owners that are indi­ viduals would report or claim these items on the ap­ propriate schedule of the Alabama Form 40 or Alabama Form 40NR, filed by the individual, depending upon the nature of the nonbusiness item. Accompanying the Ala­ bama Schedule K-1 should be an explanation of the different types and amounts of other separately stated business items making up the amount on Line M. Line O. Pass-through entity owners that are indi­ viduals would claim this amount on the Form 4562, De­ preciation and Amortization, which accompanies the individual’s Alabama Form 40 or Alabama Form 40NR. Line P. Pass-through entity owners that are indi­ viduals would claim this amount on Schedule A of the Alabama Form 40 or Alabama Form 40NR. Line Q. Pass-through entity owners that are indi­ viduals would report this amount on the Alabama Form 4952A that accompanies the individuals Alabama Form 40 or Alabama Form 40NR. Line R. Pass-through entity owners that are indi­ viduals would report or claim these items on the ap­ propriate schedule of the Alabama Form 40 or Alabama Form 40NR, filed by the individual, depending upon the nature of the other deductions. Line S. Pass-through entity owners that are indi­ viduals should claim this amount on Schedule E of the Alabama Form 40 or Alabama Form 40NR. Accompa­ nying the Alabama Schedule K-1 should be a compu­ tation of the amount reported on Line R. Alabama income tax law concerning oil and gas depletion differs from the federal law. Care should be exercised in claim­ ing this deduction to ensure that the proper amount is deducted. Line T. Pass-through entity owners that are indi­ viduals would claim this amount on the Form 4684 that accompanies the Alabama Form 40 or Alabama Form 40NR. Line U. Pass-through entity owners that are indi­ viduals are encouraged to disclose the amount of Ala­ bama exempt income on the Alabama Form 40 or Alabama Form 40NR, filed by the individual. Accom­ panying the Alabama Schedule K-1 should be an ex­ planation showing the different types of Alabama exempt income items and amounts making up the amount reported on Line T. Line V. Pass-through entity owners that are indi­ viduals are encouraged to disclose the amount of nond­ eductible expenses on the Alabama Form 40 or Alabama Form 40NR, filed by the individual. Line W. Pass-through entity owners that are indi­ viduals would report the portion of this amount that rep­ resents reportable income on the Schedule D accompanying the Alabama Form 40 or Alabama Form 40NR. Accompanying the Alabama Schedule K-1 should be a detailed explanation of the amount on Line V. Line X. Pass-through entity owners that are indi­ viduals would report this amount on the Alabama Form 4952A that accompanies the individuals Alabama Form 40 or Alabama Form 40NR. Line Y. Pass-through entity owners that are indi­ viduals would report this amount on the Alabama Form 4952A that accompanies the individuals Alabama Form 40 or Alabama Form 40NR. Line Z. Pass-through entity owners that are indi­ viduals would report or claim these items on the ap­ propriate schedule of the Alabama Form 40 or Alabama Form 40NR, filed by the individual, depending upon the nature of the other items. Accompanying the Alabama Schedule K-1 should be an explanation of the different types and amounts of other items making up the amount on Line Y. Line AA. Pass-through entity owners that are indi­ viduals would claim this amount on the Alabama Forms 40 and 40NR. Line AB. S Corporation K-1 only: Pass-through en­ tity owners that are individuals would report this amount on the Alabama Form 40 or Alabama Form 40NR. Line AC. S Corporation K-1 only: Pass-through en­ tity owners that are individuals would report the portion of this amount that represents reportable income on the Schedule D accompanying the Alabama Form 40 or Alabama Form 40NR. Accompanying the Alabama Schedule K-1 should be a detailed explanation of the amount on Line AB. Line AD. S Corporation K-1 only: These dividends should be reported to shareholders on Form 1099-DIV. Pass-through entity owners that are individuals would report this amount on the appropriate schedule of the Alabama Form 40 or Alabama Form 40NR filed by the individual. Pass-through entity owners that are individ­ uals would report this amount on the Alabama Form 40 or Alabama Form 40NR. Estates and Trusts. If you are a beneficiary of an estate or trust, you should receive a statement from the fiduciary advising you of the amount to report. Do not attach the statement to your return. Keep it for your records. Report your taxable part of the income (whether you received it or not) in Part II.

NOTE: A loss from an irrevocable trust cannot be claimed on Schedule E part II. See administrative rule 810-3-25-.05(8)(b)

Page 25 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — Under $1,000 0 50 0 0 50 100 1 1 100 200 3 3 200 300 5 5 300 400 7 7 400 500 9 9

500 600 12 11 600 700 16 13 700 800 20 15 800 900 24 17 900 1,000 28 19 1,000 1,000 1,100 32 22 1,100 1,200 36 26 1,200 1,300 40 30 1,300 1,400 44 34 1,400 1,500 48 38

1,500 1,600 52 42 1,600 1,700 56 46 1,700 1,800 60 50 1,800 1,900 64 54 1,900 2,000 68 58 2,000 2,000 2,100 72 62 2,100 2,200 76 66 2,200 2,300 80 70 2,300 2,400 84 74 2,400 2,500 88 78

2,500 2,600 92 82 2,600 2,700 96 86 2,700 2,800 100 90 2,800 2,900 104 94 2,900 3,000 108 98 3,000 3,000 3,100 113 102 3,100 3,200 118 106 3,200 3,300 123 110 3,300 3,400 128 114 3,400 3,500 133 118

3,500 3,600 138 122 3,600 3,700 143 126 3,700 3,800 148 130 3,800 3,900 153 134 3,900 4,000 158 138 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 4,000

4,000 4,100 163 142 4,100 4,200 168 146 4,200 4,300 173 150 4,300 4,400 178 154 4,400 4,500 183 158

4,500 4,600 188 162 4,600 4,700 193 166 4,700 4,800 198 170 4,800 4,900 203 174 4,900 5,000 208 178 5,000 5,000 5,100 213 182 5,100 5,200 218 186 5,200 5,300 223 190 5,300 5,400 228 194 5,400 5,500 233 198

5,500 5,600 238 202 5,600 5,700 243 206 5,700 5,800 248 210 5,800 5,900 253 214 5,900 6,000 258 218 6,000 6,000 6,100 263 223 6,100 6,200 268 228 6,200 6,300 273 233 6,300 6,400 278 238 6,400 6,500 283 243

6,500 6,600 288 248 6,600 6,700 293 253 6,700 6,800 298 258 6,800 6,900 303 263 6,900 7,000 308 268 7,000 7,000 7,100 313 273 7,100 7,200 318 278 7,200 7,300 323 283 7,300 7,400 328 288 7,400 7,500 333 293

7,500 7,600 338 298 7,600 7,700 343 303 7,700 7,800 348 308 7,800 7,900 353 313 7,900 8,000 358 318 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 8,000

8,000 8,100 363 323 8,100 8,200 368 328 8,200 8,300 373 333 8,300 8,400 378 338 8,400 8,500 383 343

8,500 8,600 388 348 8,600 8,700 393 353 8,700 8,800 398 358 8,800 8,900 403 363 8,900 9,000 408 368 9,000 9,000 9,100 413 373 9,100 9,200 418 378 9,200 9,300 423 383 9,300 9,400 428 388 9,400 9,500 433 393

9,500 9,600 438 398 9,600 9,700 443 403 9,700 9,800 448 408 9,800 9,900 453 413 9,900 10,000 458 418 10,000 10,000 10,100 463 423 10,100 10,200 468 428 10,200 10,300 473 433 10,300 10,400 478 438 10,400 10,500 483 443

10,500 10,600 488 448 10,600 10,700 493 453 10,700 10,800 498 458 10,800 10,900 503 463 10,900 11,000 508 468 11,000 11,000 11,100 513 473 11,100 11,200 518 478 11,200 11,300 523 483 11,300 11,400 528 488 11,400 11,500 533 493

11,500 11,600 538 498 11,600 11,700 543 503 11,700 11,800 548 508 11,800 11,900 553 513 11,900 12,000 558 518 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 12,000

12,000 12,100 563 523 12,100 12,200 568 528 12,200 12,300 573 533 12,300 12,400 578 538 12,400 12,500 583 543

12,500 12,600 588 548 12,600 12,700 593 553 12,700 12,800 598 558 12,800 12,900 603 563 12,900 13,000 608 568 13,000 13,000 13,100 613 573 13,100 13,200 618 578 13,200 13,300 623 583 13,300 13,400 628 588 13,400 13,500 633 593

13,500 13,600 638 598 13,600 13,700 643 603 13,700 13,800 648 608 13,800 13,900 653 613 13,900 14,000 658 618 14,000 14,000 14,100 663 623 14,100 14,200 668 628 14,200 14,300 673 633 14,300 14,400 678 638 14,400 14,500 683 643

14,500 14,600 688 648 14,600 14,700 693 653 14,700 14,800 698 658 14,800 14,900 703 663 14,900 15,000 708 668 15,000 15,000 15,100 713 673 15,100 15,200 718 678 15,200 15,300 723 683 15,300 15,400 728 688 15,400 15,500 733 693

15,500 15,600 738 698 15,600 15,700 743 703 15,700 15,800 748 708 15,800 15,900 753 713 15,900 16,000 758 718 At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family

Your tax is— $23,000 23,000 23,100 1,113 1,073 23,100 23,200 1,118 1,078 23,200 23,300 1,123 1,083 23,300 23,400 1,128 1,088 23,400 23,500 1,133 1,093 EXAMPLE: Mr. and Mrs. Brown are filing a joint return and checked box 2 on their return. Their taxable income on line 16 of Form 40 is $23,360. First, they find the $23,300 - $23,400 income line. Next, they find the column for married filing jointly and read down the column. The amount shown where the income line and the filing status column meet is $1,088. This is the amount they must write on line 17 of Form 40. Tax Table (Form 40) Based on Taxable Income This tax table is based on the taxable income shown on line 16 of Form 40 and the filing status you checked on lines 1, 2, 3, or 4 of your return.

Page 26 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 16,000 16,000 16,100 763 723 16,100 16,200 768 728 16,200 16,300 773 733 16,300 16,400 778 738 16,400 16,500 783 743

16,500 16,600 788 748 16,600 16,700 793 753 16,700 16,800 798 758 16,800 16,900 803 763 16,900 17,000 808 768 17,000 17,000 17,100 813 773 17,100 17,200 818 778 17,200 17,300 823 783 17,300 17,400 828 788 17,400 17,500 833 793

17,500 17,600 838 798 17,600 17,700 843 803 17,700 17,800 848 808 17,800 17,900 853 813 17,900 18,000 858 818 18,000 18,000 18,100 863 823 18,100 18,200 868 828 18,200 18,300 873 833 18,300 18,400 878 838 18,400 18,500 883 843

18,500 18,600 888 848 18,600 18,700 893 853 18,700 18,800 898 858 18,800 18,900 903 863 18,900 19,000 908 868 19,000 19,000 19,100 913 873 19,100 19,200 918 878 19,200 19,300 923 883 19,300 19,400 928 888 19,400 19,500 933 893

19,500 19,600 938 898 19,600 19,700 943 903 19,700 19,800 948 908 19,800 19,900 953 913 19,900 20,000 958 918 20,000 20,000 20,100 963 923 20,100 20,200 968 928 20,200 20,300 973 933 20,300 20,400 978 938 20,400 20,500 983 943

20,500 20,600 988 948 20,600 20,700 993 953 20,700 20,800 998 958 20,800 20,900 1,003 963 20,900 21,000 1,008 968 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 21,000 21,000 21,100 1,013 973 21,100 21,200 1,018 978 21,200 21,300 1,023 983 21,300 21,400 1,028 988 21,400 21,500 1,033 993

21,500 21,600 1,038 998 21,600 21,700 1,043 1,003 21,700 21,800 1,048 1,008 21,800 21,900 1,053 1,013 21,900 22,000 1,058 1,018 22,000 22,000 22,100 1,063 1,023 22,100 22,200 1,068 1,028 22,200 22,300 1,073 1,033 22,300 22,400 1,078 1,038 22,400 22,500 1,083 1,043

22,500 22,600 1,088 1,048 22,600 22,700 1,093 1,053 22,700 22,800 1,098 1,058 22,800 22,900 1,103 1,063 22,900 23,000 1,108 1,068 23,000 23,000 23,100 1,113 1,073 23,100 23,200 1,118 1,078 23,200 23,300 1,123 1,083 23,300 23,400 1,128 1,088 23,400 23,500 1,133 1,093

23,500 23,600 1,138 1,098 23,600 23,700 1,143 1,103 23,700 23,800 1,148 1,108 23,800 23,900 1,153 1,113 23,900 24,000 1,158 1,118 24,000 24,000 24,100 1,163 1,123 24,100 24,200 1,168 1,128 24,200 24,300 1,173 1,133 24,300 24,400 1,178 1,138 24,400 24,500 1,183 1,143

24,500 24,600 1,188 1,148 24,600 24,700 1,193 1,153 24,700 24,800 1,198 1,158 24,800 24,900 1,203 1,163 24,900 25,000 1,208 1,168 25,000 25,000 25,100 1,213 1,173 25,100 25,200 1,218 1,178 25,200 25,300 1,223 1,183 25,300 25,400 1,228 1,188 25,400 25,500 1,233 1,193

25,500 25,600 1,238 1,198 25,600 25,700 1,243 1,203 25,700 25,800 1,248 1,208 25,800 25,900 1,253 1,213 25,900 26,000 1,258 1,218 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 26,000 26,000 26,100 1,263 1,223 26,100 26,200 1,268 1,228 26,200 26,300 1,273 1,233 26,300 26,400 1,278 1,238 26,400 26,500 1,283 1,243

26,500 26,600 1,288 1,248 26,600 26,700 1,293 1,253 26,700 26,800 1,298 1,258 26,800 26,900 1,303 1,263 26,900 27,000 1,308 1,268 27,000 27,000 27,100 1,313 1,273 27,100 27,200 1,318 1,278 27,200 27,300 1,323 1,283 27,300 27,400 1,328 1,288 27,400 27,500 1,333 1,293

27,500 27,600 1,338 1,298 27,600 27,700 1,343 1,303 27,700 27,800 1,348 1,308 27,800 27,900 1,353 1,313 27,900 28,000 1,358 1,318 28,000 28,000 28,100 1,363 1,323 28,100 28,200 1,368 1,328 28,200 28,300 1,373 1,333 28,300 28,400 1,378 1,338 28,400 28,500 1,383 1,343

28,500 28,600 1,388 1,348 28,600 28,700 1,393 1,353 28,700 28,800 1,398 1,358 28,800 28,900 1,403 1,363 28,900 29,000 1,408 1,368 29,000 29,000 29,100 1,413 1,373 29,100 29,200 1,418 1,378 29,200 29,300 1,423 1,383 29,300 29,400 1,428 1,388 29,400 29,500 1,433 1,393

29,500 29,600 1,438 1,398 29,600 29,700 1,443 1,403 29,700 29,800 1,448 1,408 29,800 29,900 1,453 1,413 29,900 30,000 1,458 1,418 30,000 30,000 30,100 1,463 1,423 30,100 30,200 1,468 1,428 30,200 30,300 1,473 1,433 30,300 30,400 1,478 1,438 30,400 30,500 1,483 1,443

30,500 30,600 1,488 1,448 30,600 30,700 1,493 1,453 30,700 30,800 1,498 1,458 30,800 30,900 1,503 1,463 30,900 31,000 1,508 1,468 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 31,000 31,000 31,100 1,513 1,473 31,100 31,200 1,518 1,478 31,200 31,300 1,523 1,483 31,300 31,400 1,528 1,488 31,400 31,500 1,533 1,493

31,500 31,600 1,538 1,498 31,600 31,700 1,543 1,503 31,700 31,800 1,548 1,508 31,800 31,900 1,553 1,513 31,900 32,000 1,558 1,518 32,000 32,000 32,100 1,563 1,523 32,100 32,200 1,568 1,528 32,200 32,300 1,573 1,533 32,300 32,400 1,578 1,538 32,400 32,500 1,583 1,543

32,500 32,600 1,588 1,548 32,600 32,700 1,593 1,553 32,700 32,800 1,598 1,558 32,800 32,900 1,603 1,563 32,900 33,000 1,608 1,568 33,000 33,000 33,100 1,613 1,573 33,100 33,200 1,618 1,578 33,200 33,300 1,623 1,583 33,300 33,400 1,628 1,588 33,400 33,500 1,633 1,593

33,500 33,600 1,638 1,598 33,600 33,700 1,643 1,603 33,700 33,800 1,648 1,608 33,800 33,900 1,653 1,613 33,900 34,000 1,658 1,618 34,000 34,000 34,100 1,663 1,623 34,100 34,200 1,668 1,628 34,200 34,300 1,673 1,633 34,300 34,400 1,678 1,638 34,400 34,500 1,683 1,643

34,500 34,600 1,688 1,648 34,600 34,700 1,693 1,653 34,700 34,800 1,698 1,658 34,800 34,900 1,703 1,663 34,900 35,000 1,708 1,668 35,000 35,000 35,100 1,713 1,673 35,100 35,200 1,718 1,678 35,200 35,300 1,723 1,683 35,300 35,400 1,728 1,688 35,400 35,500 1,733 1,693

35,500 35,600 1,738 1,698 35,600 35,700 1,743 1,703 35,700 35,800 1,748 1,708 35,800 35,900 1,753 1,713 35,900 36,000 1,758 1,718 Tax Table – Continued

Page 27 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 36,000 36,000 36,100 1,763 1,723 36,100 36,200 1,768 1,728 36,200 36,300 1,773 1,733 36,300 36,400 1,778 1,738 36,400 36,500 1,783 1,743

36,500 36,600 1,788 1,748 36,600 36,700 1,793 1,753 36,700 36,800 1,798 1,758 36,800 36,900 1,803 1,763 36,900 37,000 1,808 1,768 37,000 37,000 37,100 1,813 1,773 37,100 37,200 1,818 1,778 37,200 37,300 1,823 1,783 37,300 37,400 1,828 1,788 37,400 37,500 1,833 1,793

37,500 37,600 1,838 1,798 37,600 37,700 1,843 1,803 37,700 37,800 1,848 1,808 37,800 37,900 1,853 1,813 37,900 38,000 1,858 1,818 38,000 38,000 38,100 1,863 1,823 38,100 38,200 1,868 1,828 38,200 38,300 1,873 1,833 38,300 38,400 1,878 1,838 38,400 38,500 1,883 1,843

38,500 38,600 1,888 1,848 38,600 38,700 1,893 1,853 38,700 38,800 1,898 1,858 38,800 38,900 1,903 1,863 38,900 39,000 1,908 1,868 39,000 39,000 39,100 1,913 1,873 39,100 39,200 1,918 1,878 39,200 39,300 1,923 1,883 39,300 39,400 1,928 1,888 39,400 39,500 1,933 1,893

39,500 39,600 1,938 1,898 39,600 39,700 1,943 1,903 39,700 39,800 1,948 1,908 39,800 39,900 1,953 1,913 39,900 40,000 1,958 1,918 40,000 40,000 40,100 1,963 1,923 40,100 40,200 1,968 1,928 40,200 40,300 1,973 1,933 40,300 40,400 1,978 1,938 40,400 40,500 1,983 1,943

40,500 40,600 1,988 1,948 40,600 40,700 1,993 1,953 40,700 40,800 1,998 1,958 40,800 40,900 2,003 1,963 40,900 41,000 2,008 1,968 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 41,000 41,000 41,100 2,013 1,973 41,100 41,200 2,018 1,978 41,200 41,300 2,023 1,983 41,300 41,400 2,028 1,988 41,400 41,500 2,033 1,993

41,500 41,600 2,038 1,998 41,600 41,700 2,043 2,003 41,700 41,800 2,048 2,008 41,800 41,900 2,053 2,013 41,900 42,000 2,058 2,018 42,000 42,000 42,100 2,063 2,023 42,100 42,200 2,068 2,028 42,200 42,300 2,073 2,033 42,300 42,400 2,078 2,038 42,400 42,500 2,083 2,043

42,500 42,600 2,088 2,048 42,600 42,700 2,093 2,053 42,700 42,800 2,098 2,058 42,800 42,900 2,103 2,063 42,900 43,000 2,108 2,068 43,000 43,000 43,100 2,113 2,073 43,100 43,200 2,118 2,078 43,200 43,300 2,123 2,083 43,300 43,400 2,128 2,088 43,400 43,500 2,133 2,093

43,500 43,600 2,138 2,098 43,600 43,700 2,143 2,103 43,700 43,800 2,148 2,108 43,800 43,900 2,153 2,113 43,900 44,000 2,158 2,118 44,000 44,000 44,100 2,163 2,123 44,100 44,200 2,168 2,128 44,200 44,300 2,173 2,133 44,300 44,400 2,178 2,138 44,400 44,500 2,183 2,143

44,500 44,600 2,188 2,148 44,600 44,700 2,193 2,153 44,700 44,800 2,198 2,158 44,800 44,900 2,203 2,163 44,900 45,000 2,208 2,168 45,000 45,000 45,100 2,213 2,173 45,100 45,200 2,218 2,178 45,200 45,300 2,223 2,183 45,300 45,400 2,228 2,188 45,400 45,500 2,233 2,193

45,500 45,600 2,238 2,198 45,600 45,700 2,243 2,203 45,700 45,800 2,248 2,208 45,800 45,900 2,253 2,213 45,900 46,000 2,258 2,218 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 46,000 46,000 46,100 2,263 2,223 46,100 46,200 2,268 2,228 46,200 46,300 2,273 2,233 46,300 46,400 2,278 2,238 46,400 46,500 2,283 2,243

46,500 46,600 2,288 2,248 46,600 46,700 2,293 2,253 46,700 46,800 2,298 2,258 46,800 46,900 2,303 2,263 46,900 47,000 2,308 2,268 47,000 47,000 47,100 2,313 2,273 47,100 47,200 2,318 2,278 47,200 47,300 2,323 2,283 47,300 47,400 2,328 2,288 47,400 47,500 2,333 2,293

47,500 47,600 2,338 2,298 47,600 47,700 2,343 2,303 47,700 47,800 2,348 2,308 47,800 47,900 2,353 2,313 47,900 48,000 2,358 2,318 48,000 48,000 48,100 2,363 2,323 48,100 48,200 2,368 2,328 48,200 48,300 2,373 2,333 48,300 48,400 2,378 2,338 48,400 48,500 2,383 2,343

48,500 48,600 2,388 2,348 48,600 48,700 2,393 2,353 48,700 48,800 2,398 2,358 48,800 48,900 2,403 2,363 48,900 49,000 2,408 2,368 49,000 49,000 49,100 2,413 2,373 49,100 49,200 2,418 2,378 49,200 49,300 2,423 2,383 49,300 49,400 2,428 2,388 49,400 49,500 2,433 2,393

49,500 49,600 2,438 2,398 49,600 49,700 2,443 2,403 49,700 49,800 2,448 2,408 49,800 49,900 2,453 2,413 49,900 50,000 2,458 2,418 50,000 50,000 50,100 2,463 2,423 50,100 50,200 2,468 2,428 50,200 50,300 2,473 2,433 50,300 50,400 2,478 2,438 50,400 50,500 2,483 2,443

50,500 50,600 2,488 2,448 50,600 50,700 2,493 2,453 50,700 50,800 2,498 2,458 50,800 50,900 2,503 2,463 50,900 51,000 2,508 2,468 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 51,000 51,000 51,100 2,513 2,473 51,100 51,200 2,518 2,478 51,200 51,300 2,523 2,483 51,300 51,400 2,528 2,488 51,400 51,500 2,533 2,493

51,500 51,600 2,538 2,498 51,600 51,700 2,543 2,503 51,700 51,800 2,548 2,508 51,800 51,900 2,553 2,513 51,900 52,000 2,558 2,518 52,000 52,000 52,100 2,563 2,523 52,100 52,200 2,568 2,528 52,200 52,300 2,573 2,533 52,300 52,400 2,578 2,538 52,400 52,500 2,583 2,543

52,500 52,600 2,588 2,548 52,600 52,700 2,593 2,553 52,700 52,800 2,598 2,558 52,800 52,900 2,603 2,563 52,900 53,000 2,608 2,568 53,000 53,000 53,100 2,613 2,573 53,100 53,200 2,618 2,578 53,200 53,300 2,623 2,583 53,300 53,400 2,628 2,588 53,400 53,500 2,633 2,593

53,500 53,600 2,638 2,598 53,600 53,700 2,643 2,603 53,700 53,800 2,648 2,608 53,800 53,900 2,653 2,613 53,900 54,000 2,658 2,618 54,000 54,000 54,100 2,663 2,623 54,100 54,200 2,668 2,628 54,200 54,300 2,673 2,633 54,300 54,400 2,678 2,638 54,400 54,500 2,683 2,643

54,500 54,600 2,688 2,648 54,600 54,700 2,693 2,653 54,700 54,800 2,698 2,658 54,800 54,900 2,703 2,663 54,900 55,000 2,708 2,668 55,000 55,000 55,100 2,713 2,673 55,100 55,200 2,718 2,678 55,200 55,300 2,723 2,683 55,300 55,400 2,728 2,688 55,400 55,500 2,733 2,693

55,500 55,600 2,738 2,698 55,600 55,700 2,743 2,703 55,700 55,800 2,748 2,708 55,800 55,900 2,753 2,713 55,900 56,000 2,758 2,718 Tax Table – Continued

Page 28 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 56,000 56,000 56,100 2,763 2,723 56,100 56,200 2,768 2,728 56,200 56,300 2,773 2,733 56,300 56,400 2,778 2,738 56,400 56,500 2,783 2,743

56,500 56,600 2,788 2,748 56,600 56,700 2,793 2,753 56,700 56,800 2,798 2,758 56,800 56,900 2,803 2,763 56,900 57,000 2,808 2,768 57,000 57,000 57,100 2,813 2,773 57,100 57,200 2,818 2,778 57,200 57,300 2,823 2,783 57,300 57,400 2,828 2,788 57,400 57,500 2,833 2,793

57,500 57,600 2,838 2,798 57,600 57,700 2,843 2,803 57,700 57,800 2,848 2,808 57,800 57,900 2,853 2,813 57,900 58,000 2,858 2,818 58,000 58,000 58,100 2,863 2,823 58,100 58,200 2,868 2,828 58,200 58,300 2,873 2,833 58,300 58,400 2,878 2,838 58,400 58,500 2,883 2,843

58,500 58,600 2,888 2,848 58,600 58,700 2,893 2,853 58,700 58,800 2,898 2,858 58,800 58,900 2,903 2,863 58,900 59,000 2,908 2,868 59,000 59,000 59,100 2,913 2,873 59,100 59,200 2,918 2,878 59,200 59,300 2,923 2,883 59,300 59,400 2,928 2,888 59,400 59,500 2,933 2,893

59,500 59,600 2,938 2,898 59,600 59,700 2,943 2,903 59,700 59,800 2,948 2,908 59,800 59,900 2,953 2,913 59,900 60,000 2,958 2,918 60,000 60,000 60,100 2,963 2,923 60,100 60,200 2,968 2,928 60,200 60,300 2,973 2,933 60,300 60,400 2,978 2,938 60,400 60,500 2,983 2,943

60,500 60,600 2,988 2,948 60,600 60,700 2,993 2,953 60,700 60,800 2,998 2,958 60,800 60,900 3,003 2,963 60,900 61,000 3,008 2,968 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 61,000 61,000 61,100 3,013 2,973 61,100 61,200 3,018 2,978 61,200 61,300 3,023 2,983 61,300 61,400 3,028 2,988 61,400 61,500 3,033 2,993

61,500 61,600 3,038 2,998 61,600 61,700 3,043 3,003 61,700 61,800 3,048 3,008 61,800 61,900 3,053 3,013 61,900 62,000 3,058 3,018 62,000 62,000 62,100 3,063 3,023 62,100 62,200 3,068 3,028 62,200 62,300 3,073 3,033 62,300 62,400 3,078 3,038 62,400 62,500 3,083 3,043

62,500 62,600 3,088 3,048 62,600 62,700 3,093 3,053 62,700 62,800 3,098 3,058 62,800 62,900 3,103 3,063 62,900 63,000 3,108 3,068 63,000 63,000 63,100 3,113 3,073 63,100 63,200 3,118 3,078 63,200 63,300 3,123 3,083 63,300 63,400 3,128 3,088 63,400 63,500 3,133 3,093

63,500 63,600 3,138 3,098 63,600 63,700 3,143 3,103 63,700 63,800 3,148 3,108 63,800 63,900 3,153 3,113 63,900 64,000 3,158 3,118 64,000 64,000 64,100 3,163 3,123 64,100 64,200 3,168 3,128 64,200 64,300 3,173 3,133 64,300 64,400 3,178 3,138 64,400 64,500 3,183 3,143

64,500 64,600 3,188 3,148 64,600 64,700 3,193 3,153 64,700 64,800 3,198 3,158 64,800 64,900 3,203 3,163 64,900 65,000 3,208 3,168 65,000 65,000 65,100 3,213 3,173 65,100 65,200 3,218 3,178 65,200 65,300 3,223 3,183 65,300 65,400 3,228 3,188 65,400 65,500 3,233 3,193

65,500 65,600 3,238 3,198 65,600 65,700 3,243 3,203 65,700 65,800 3,248 3,208 65,800 65,900 3,253 3,213 65,900 66,000 3,258 3,218 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 66,000 66,000 66,100 3,263 3,223 66,100 66,200 3,268 3,228 66,200 66,300 3,273 3,233 66,300 66,400 3,278 3,238 66,400 66,500 3,283 3,243

66,500 66,600 3,288 3,248 66,600 66,700 3,293 3,253 66,700 66,800 3,298 3,258 66,800 66,900 3,303 3,263 66,900 67,000 3,308 3,268 67,000 67,000 67,100 3,313 3,273 67,100 67,200 3,318 3,278 67,200 67,300 3,323 3,283 67,300 67,400 3,328 3,288 67,400 67,500 3,333 3,293

67,500 67,600 3,338 3,298 67,600 67,700 3,343 3,303 67,700 67,800 3,348 3,308 67,800 67,900 3,353 3,313 67,900 68,000 3,358 3,318 68,000 68,000 68,100 3,363 3,323 68,100 68,200 3,368 3,328 68,200 68,300 3,373 3,333 68,300 68,400 3,378 3,338 68,400 68,500 3,383 3,343

68,500 68,600 3,388 3,348 68,600 68,700 3,393 3,353 68,700 68,800 3,398 3,358 68,800 68,900 3,403 3,363 68,900 69,000 3,408 3,368 69,000 69,000 69,100 3,413 3,373 69,100 69,200 3,418 3,378 69,200 69,300 3,423 3,383 69,300 69,400 3,428 3,388 69,400 69,500 3,433 3,393

69,500 69,600 3,438 3,398 69,600 69,700 3,443 3,403 69,700 69,800 3,448 3,408 69,800 69,900 3,453 3,413 69,900 70,000 3,458 3,418 70,000 70,000 70,100 3,463 3,423 70,100 70,200 3,468 3,428 70,200 70,300 3,473 3,433 70,300 70,400 3,478 3,438 70,400 70,500 3,483 3,443

70,500 70,600 3,488 3,448 70,600 70,700 3,493 3,453 70,700 70,800 3,498 3,458 70,800 70,900 3,503 3,463 70,900 71,000 3,508 3,468 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 71,000 71,000 71,100 3,513 3,473 71,100 71,200 3,518 3,478 71,200 71,300 3,523 3,483 71,300 71,400 3,528 3,488 71,400 71,500 3,533 3,493

71,500 71,600 3,538 3,498 71,600 71,700 3,543 3,503 71,700 71,800 3,548 3,508 71,800 71,900 3,553 3,513 71,900 72,000 3,558 3,518 72,000 72,000 72,100 3,563 3,523 72,100 72,200 3,568 3,528 72,200 72,300 3,573 3,533 72,300 72,400 3,578 3,538 72,400 72,500 3,583 3,543

72,500 72,600 3,588 3,548 72,600 72,700 3,593 3,553 72,700 72,800 3,598 3,558 72,800 72,900 3,603 3,563 72,900 73,000 3,608 3,568 73,000 73,000 73,100 3,613 3,573 73,100 73,200 3,618 3,578 73,200 73,300 3,623 3,583 73,300 73,400 3,628 3,588 73,400 73,500 3,633 3,593

73,500 73,600 3,638 3,598 73,600 73,700 3,643 3,603 73,700 73,800 3,648 3,608 73,800 73,900 3,653 3,613 73,900 74,000 3,658 3,618 74,000 74,000 74,100 3,663 3,623 74,100 74,200 3,668 3,628 74,200 74,300 3,673 3,633 74,300 74,400 3,678 3,638 74,400 74,500 3,683 3,643

74,500 74,600 3,688 3,648 74,600 74,700 3,693 3,653 74,700 74,800 3,698 3,658 74,800 74,900 3,703 3,663 74,900 75,000 3,708 3,668 75,000 75,000 75,100 3,713 3,673 75,100 75,200 3,718 3,678 75,200 75,300 3,723 3,683 75,300 75,400 3,728 3,688 75,400 75,500 3,733 3,693

75,500 75,600 3,738 3,698 75,600 75,700 3,743 3,703 75,700 75,800 3,748 3,708 75,800 75,900 3,753 3,713 75,900 76,000 3,758 3,718 Tax Table – Continued

Page 29 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 76,000 76,000 76,100 3,763 3,723 76,100 76,200 3,768 3,728 76,200 76,300 3,773 3,733 76,300 76,400 3,778 3,738 76,400 76,500 3,783 3,743

76,500 76,600 3,788 3,748 76,600 76,700 3,793 3,753 76,700 76,800 3,798 3,758 76,800 76,900 3,803 3,763 76,900 77,000 3,808 3,768 77,000 77,000 77,100 3,813 3,773 77,100 77,200 3,818 3,778 77,200 77,300 3,823 3,783 77,300 77,400 3,828 3,788 77,400 77,500 3,833 3,793

77,500 77,600 3,838 3,798 77,600 77,700 3,843 3,803 77,700 77,800 3,848 3,808 77,800 77,900 3,853 3,813 77,900 78,000 3,858 3,818 78,000 78,000 78,100 3,863 3,823 78,100 78,200 3,868 3,828 78,200 78,300 3,873 3,833 78,300 78,400 3,878 3,838 78,400 78,500 3,883 3,843

78,500 78,600 3,888 3,848 78,600 78,700 3,893 3,853 78,700 78,800 3,898 3,858 78,800 78,900 3,903 3,863 78,900 79,000 3,908 3,868 79,000 79,000 79,100 3,913 3,873 79,100 79,200 3,918 3,878 79,200 79,300 3,923 3,883 79,300 79,400 3,928 3,888 79,400 79,500 3,933 3,893

79,500 79,600 3,938 3,898 79,600 79,700 3,943 3,903 79,700 79,800 3,948 3,908 79,800 79,900 3,953 3,913 79,900 80,000 3,958 3,918 80,000 80,000 80,100 3,963 3,923 80,100 80,200 3,968 3,928 80,200 80,300 3,973 3,933 80,300 80,400 3,978 3,938 80,400 80,500 3,983 3,943

80,500 80,600 3,988 3,948 80,600 80,700 3,993 3,953 80,700 80,800 3,998 3,958 80,800 80,900 4,003 3,963 80,900 81,000 4,008 3,968 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 81,000 81,000 81,100 4,013 3,973 81,100 81,200 4,018 3,978 81,200 81,300 4,023 3,983 81,300 81,400 4,028 3,988 81,400 81,500 4,033 3,993

81,500 81,600 4,038 3,998 81,600 81,700 4,043 4,003 81,700 81,800 4,048 4,008 81,800 81,900 4,053 4,013 81,900 82,000 4,058 4,018 82,000 82,000 82,100 4,063 4,023 82,100 82,200 4,068 4,028 82,200 82,300 4,073 4,033 82,300 82,400 4,078 4,038 82,400 82,500 4,083 4,043

82,500 82,600 4,088 4,048 82,600 82,700 4,093 4,053 82,700 82,800 4,098 4,058 82,800 82,900 4,103 4,063 82,900 83,000 4,108 4,068 83,000 83,000 83,100 4,113 4,073 83,100 83,200 4,118 4,078 83,200 83,300 4,123 4,083 83,300 83,400 4,128 4,088 83,400 83,500 4,133 4,093

83,500 83,600 4,138 4,098 83,600 83,700 4,143 4,103 83,700 83,800 4,148 4,108 83,800 83,900 4,153 4,113 83,900 84,000 4,158 4,118 84,000 84,000 84,100 4,163 4,123 84,100 84,200 4,168 4,128 84,200 84,300 4,173 4,133 84,300 84,400 4,178 4,138 84,400 84,500 4,183 4,143

84,500 84,600 4,188 4,148 84,600 84,700 4,193 4,153 84,700 84,800 4,198 4,158 84,800 84,900 4,203 4,163 84,900 85,000 4,208 4,168 85,000 85,000 85,100 4,213 4,173 85,100 85,200 4,218 4,178 85,200 85,300 4,223 4,183 85,300 85,400 4,228 4,188 85,400 85,500 4,233 4,193

85,500 85,600 4,238 4,198 85,600 85,700 4,243 4,203 85,700 85,800 4,248 4,208 85,800 85,900 4,253 4,213 85,900 86,000 4,258 4,218 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 86,000 86,000 86,100 4,263 4,223 86,100 86,200 4,268 4,228 86,200 86,300 4,273 4,233 86,300 86,400 4,278 4,238 86,400 86,500 4,283 4,243

86,500 86,600 4,288 4,248 86,600 86,700 4,293 4,253 86,700 86,800 4,298 4,258 86,800 86,900 4,303 4,263 86,900 87,000 4,308 4,268 87,000 87,000 87,100 4,313 4,273 87,100 87,200 4,318 4,278 87,200 87,300 4,323 4,283 87,300 87,400 4,328 4,288 87,400 87,500 4,333 4,293

87,500 87,600 4,338 4,298 87,600 87,700 4,343 4,303 87,700 87,800 4,348 4,308 87,800 87,900 4,353 4,313 87,900 88,000 4,358 4,318 88,000 88,000 88,100 4,363 4,323 88,100 88,200 4,368 4,328 88,200 88,300 4,373 4,333 88,300 88,400 4,378 4,338 88,400 88,500 4,383 4,343

88,500 88,600 4,388 4,348 88,600 88,700 4,393 4,353 88,700 88,800 4,398 4,358 88,800 88,900 4,403 4,363 88,900 89,000 4,408 4,368 89,000 89,000 89,100 4,413 4,373 89,100 89,200 4,418 4,378 89,200 89,300 4,423 4,383 89,300 89,400 4,428 4,388 89,400 89,500 4,433 4,393

89,500 89,600 4,438 4,398 89,600 89,700 4,443 4,403 89,700 89,800 4,448 4,408 89,800 89,900 4,453 4,413 89,900 90,000 4,458 4,418 90,000 90,000 90,100 4,463 4,423 90,100 90,200 4,468 4,428 90,200 90,300 4,473 4,433 90,300 90,400 4,478 4,438 90,400 90,500 4,483 4,443

90,500 90,600 4,488 4,448 90,600 90,700 4,493 4,453 90,700 90,800 4,498 4,458 90,800 90,900 4,503 4,463 90,900 91,000 4,508 4,468 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 91,000 91,000 91,100 4,513 4,473 91,100 91,200 4,518 4,478 91,200 91,300 4,523 4,483 91,300 91,400 4,528 4,488 91,400 91,500 4,533 4,493

91,500 91,600 4,538 4,498 91,600 91,700 4,543 4,503 91,700 91,800 4,548 4,508 91,800 91,900 4,553 4,513 91,900 92,000 4,558 4,518 92,000 92,000 92,100 4,563 4,523 92,100 92,200 4,568 4,528 92,200 92,300 4,573 4,533 92,300 92,400 4,578 4,538 92,400 92,500 4,583 4,543

92,500 92,600 4,588 4,548 92,600 92,700 4,593 4,553 92,700 92,800 4,598 4,558 92,800 92,900 4,603 4,563 92,900 93,000 4,608 4,568 93,000 93,000 93,100 4,613 4,573 93,100 93,200 4,618 4,578 93,200 93,300 4,623 4,583 93,300 93,400 4,628 4,588 93,400 93,500 4,633 4,593

93,500 93,600 4,638 4,598 93,600 93,700 4,643 4,603 93,700 93,800 4,648 4,608 93,800 93,900 4,653 4,613 93,900 94,000 4,658 4,618 94,000 94,000 94,100 4,663 4,623 94,100 94,200 4,668 4,628 94,200 94,300 4,673 4,633 94,300 94,400 4,678 4,638 94,400 94,500 4,683 4,643

94,500 94,600 4,688 4,648 94,600 94,700 4,693 4,653 94,700 94,800 4,698 4,658 94,800 94,900 4,703 4,663 94,900 95,000 4,708 4,668 95,000 95,000 95,100 4,713 4,673 95,100 95,200 4,718 4,678 95,200 95,300 4,723 4,683 95,300 95,400 4,728 4,688 95,400 95,500 4,733 4,693

95,500 95,600 4,738 4,698 95,600 95,700 4,743 4,703 95,700 95,800 4,748 4,708 95,800 95,900 4,753 4,713 95,900 96,000 4,758 4,718 Tax Table – Continued

Page 30 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 96,000 96,000 96,100 4,763 4,723 96,100 96,200 4,768 4,728 96,200 96,300 4,773 4,733 96,300 96,400 4,778 4,738 96,400 96,500 4,783 4,743

96,500 96,600 4,788 4,748 96,600 96,700 4,793 4,753 96,700 96,800 4,798 4,758 96,800 96,900 4,803 4,763 96,900 97,000 4,808 4,768 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 97,000 97,000 97,100 4,813 4,773 97,100 97,200 4,818 4,778 97,200 97,300 4,823 4,783 97,300 97,400 4,828 4,788 97,400 97,500 4,833 4,793

97,500 97,600 4,838 4,798 97,600 97,700 4,843 4,803 97,700 97,800 4,848 4,808 97,800 97,900 4,853 4,813 97,900 98,000 4,858 4,818 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 98,000 98,000 98,100 4,863 4,823 98,100 98,200 4,868 4,828 98,200 98,300 4,873 4,833 98,300 98,400 4,878 4,838 98,400 98,500 4,883 4,843

98,500 98,600 4,888 4,848 98,600 98,700 4,893 4,853 98,700 98,800 4,898 4,858 98,800 98,900 4,903 4,863 98,900 99,000 4,908 4,868 If taxable And you are — income is — At But Single Married least less ✱ filing than Married jointly filing sepa- rately ✱ Head of family Your tax is — 99,000 99,000 99,100 4,913 4,873 99,100 99,200 4,918 4,878 99,200 99,300 4,923 4,883 99,300 99,400 4,928 4,888 99,400 99,500 4,933 4,893

99,500 99,600 4,938 4,898 99,600 99,700 4,943 4,903 99,700 99,800 4,948 4,908 99,800 99,900 4,953 4,913 99,900 100,000 4,958 4,918 Tax Table – Continued Over $100,000.00

If taxable income is over $100,000, use the following worksheet to figure your tax.

• Single • Married filing separately • Head of family

1 Enter taxable income . .

2 Less. . . . . . . . . . . . . . . –100,000.00 3 Subtract line 2 from line 1 . . . . . . . . . . . . . . . 4 Multiply line 3 by .05 . . x .05

5 Enter result here . . . . . . 6 Plus . . . . . . . . . . . . . . . + 4,958.00 7 Add lines 5 and 6. Your tax is . . . . . . . .

• Married filing jointly

1 Enter taxable income . .

2 Less. . . . . . . . . . . . . . . –100,000.00 3 Subtract line 2 from line 1 . . . . . . . . . . . . . . . 4 Multiply line 3 by .05 . . x .05

5 Enter result here . . . . . . 6 Plus . . . . . . . . . . . . . . . . . + 4,918.00 7 Add lines 5 and 6. Your tax is . . . . . . . . ▼ ▼

Page 31 Federal Income Tax Deduction Worksheet 1 Enter the tax as shown on line 22 on 2024 Form 1040/Form 1040-SR/Form 1040NR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Net Investment Income Tax. Enter amount from line 17, 2024 Form 8960. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Federal Tax. Add Lines 1 and 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4a Earned Income Credit (EIC). Enter the amount from line 27 of 2024 Form 1040/Form 1040-SR. 4b Additional Child Tax Credit. Enter the amount from Line 28 of 2024 Form 1040/Form 1040-SR/1040-NR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4c American Opportunity Credit. Enter the amount from line 29 of 2024 Form 1040/Form 1040-SR. 4d Credits from Forms 2439. Enter the amount from Schedule 3, Part II, line 13a of 2024 Form 1040/Form 1040-SR/Form1040NR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Add lines 4a,b, c and d. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Subtract line 5 from line 3. If amount is negative enter zero also enter on line 12 of Form 40, line 9 of Form 40A or page 2, Part IV, line 4 of Form 40NR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1 2 3

5

6

00 00 00

00

00

00

00 00

00

4a

4b 4c

4d

Page 32 My Alabama Taxes (MAT) You can file your Alabama Resident and Non-Resident returns online through My Alabama Taxes (MAT) at no charge. The Alabama Department of Revenue offers several methods for filing your Individual Income Tax Return. Federal/State Electronic Filing Program Your professional tax practitioner can file both your Federal and State returns by using the E-File Program or can print a 2-D Barcode for you.

Free Filing of Federal/State Return Free electronic filing of your Alabama and Federal Income Tax Returns are provided for low income wage earners, senior citizens, students, and active duty military personnel. For more information on the qualifications, visit our website at https://www.revenue.alabama.gov/individual- corporate/individual-income-tax/individual-income-tax-electronic-fili ng-options/.

Federal/State On-Line Filing Program You can file your own Federal and State return on-line by purchasing the program from a local retailer or going to https://www.revenue.alabama.gov/individual-corporate/ approved-software-vendors/ to see a listing of Approved On-Line Service Providers. If you do not want to file electronically, these programs will print out a 2-D Barcode.

This option is available to all taxpayers filing an Alabama Individual Income tax return. Please visit https://revenue.alabama.gov/services/my-alabama-taxes-sign-up/ to sign up and get started filling out your return. 2-D Barcode Filing Program All the programs above should produce a 2-D Barcode for you. Also, you can print a 2-D Barcode by using our fillable Form 40 or Form 40NR which you can obtain at https://www.revenue.alabama.gov/forms/. After you fill out the form and print it, a 2-D Barcode will be produced on the top of the form. You can still mail your return, but use of the 2-D Barcode will ensure faster processing. OTHER FILING OPTIONS: VITA/AARP/IMPACT ALABAMA Free tax help and electronic filing of your Federal and State returns for low to moderate income taxpayers, people age 60 and older and military families is provided by the VITA, AARP, or IMPACT ALABAMA volunteers. For more information, visit our website at https://www.revenue.alabama.gov/individual-corporate/.

To obtain instructions, schedules and forms visit our Web site at: www.revenue.alabama.gov. Additional booklets, forms, and schedules are listed below. Certain book­ lets may be obtained by visiting the Alabama Taxpayer Service Center nearest you. BOOKLETS Form 40 Booklet. This booklet contains the following forms and schedules with instructions: Form 40, Schedules A, B, DC, CR, D, E, W-2, DS, HOF, ATP, RS, and Form 40V. Form 40NR Booklet. This booklet contains the following forms and schedules with instructions: Form 40NR, Schedules A, B, D, E, W-2, DS, HOF, RS, and Form 40V. FORMS Form 40 Individual Income Tax Return for full year residents of Alabama and also part-year residents of Alabama. Form 40A Individual Income Tax Return (Short Form) for full year residents of Alabama. Form 40NR Nonresident Individual Income Tax Return for nonresidents of Alabama. Form 40ES to make estimated tax payments. SCHEDULES Schedule A, B, & DC – for itemized deductions, interest and dividend income, and donation check-offs. Schedule CR – for computation of credit for taxes paid to other states. Schedule D&E – for reporting income from the sale or exchange of capital assets, and for reporting income from rents, royalties, partnerships, estates, and trusts. Schedule AAC – for computation of Alabama adoption tax credit. Schedule AATC – for computation of the credit for transferring a student from a failing public school to a non-failing public school or non-public school. Schedule DS – form must be completed to receive proper credit for dependents claimed on Form 40 and 40NR. Schedule HOF – form must be completed to receive proper credit for head of family claimed on Form 40 and 40NR. Schedule OC – for computation of individual tax credits. Schedule W-2 – form must be completed to receive proper credit for Alabama income tax withheld on Forms 40A, 40, and 40NR. Schedule CP – form must be completed to receive proper credit for Alabama composite payments withheld and Electing PTE Credits. Schedule KRCC-I – for reporting the recipient’s share of Capital Credit for Individual Taxpayers. Schedule ATP – for computation of Additional Taxes & Penalties. Schedule HBC – form must be completed to receive proper credit for First Time Second Chance Home Buyer Deduction. Schedule RS – form must be completed to report report fully or partially taxable pensions, annuities, IRA distributions and retirement distribution(s) exempt from Alabama Income.

NOTE: Alabama does not provide the following forms and schedules and requests that the appropriate federal schedule be used making the modifications as required by Alabama law. Schedule C for reporting income from a personally owned business. Schedule F for reporting income from farming. Form 2106 for claiming employee business expenses. Form 3903 for claiming moving expenses. Form 4684 for reporting casualty and theft losses. Form 4797 for reporting sale of business property. Form 6252 for reporting installment sale income. Form 8283 for reporting noncash contributions. Page 33 Page 33 How To Obtain Forms

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