Alabama PTET 2026: deadline, rate, who can elect
Alabama (AL), tax year 2026, from the same rules the connector returns. Last verified October 24, 2026.
Informational. Not tax advice.
Elective PTET
Yes
For tax years beginning on or after January 1, 2021, an Alabama S corporation or Subchapter K entity may elect to be taxed as an electing pass-through entity.
Who can elect
An Alabama S corporation, as defined in section 40-18-160, or a Subchapter K entity, as defined in section 40-18-1.
The Department page is the eligibility source.
How the election is made
For tax periods beginning on or after January 1, 2025, check the electing PTE box on a timely filed Form 65 or Form 20S, including extensions, and file Form EPT. The election also requires a vote or written consent of the governing body and of owners or shareholders holding more than 50 percent of the voting control.
The electing PTE box must be checked each year the election is in effect.
Election deadline
Any time during the tax year before the due date of the applicable income tax return, including extensions.
The election is made on the timely filed return.
Rate
The tax rate is 5 percent.
The Department's entity-level tax rate FAQ states that rate. Rule 810-3-36-.01 says the entity applies the maximum rate in section 40-18-5.
Owner relief
A refundable credit equal to the owner's pro rata or distributive share of the Alabama income tax paid by the electing pass-through entity.
Rule 810-3-36-.01 states that credit.
Estimates
Required when Alabama income tax liability exceeds $500. Quarterly payments are 25 percent of the required annual payment, generally the lesser of 100 percent of the current-year tax or 100 percent of the preceding-year tax, with the safe-harbor limits the page describes.
The page applies section 40-18-80.1. It does not list calendar due dates in the text reviewed.
Sunset or repeal
Rule 810-3-36-.01 says the election is binding for the year it is approved and for all subsequent tax years until the entity requests revocation on Form PTE-E. The rule does not state a statutory end date.
The operative statute was not read. This is the rule's duration.
Sources for this year
Bonus-depreciation conformity is on its own page.