Alabama Income Tax Guide for 2026

Overview

Alabama uses a progressive income tax system with rates ranging from 2% to 5%. Capital gains are taxed as ordinary income. The state offers a standard deduction of $3,000 for single filers, personal exemptions of $1,500, and dependent exemptions of $1,000.

Income Tax Rates

Single Filers

Income Range	Tax Rate
Up to $499	2%
$500 - $2,999	4%
$3,000+	5%

Married Filing Jointly

Income Range	Tax Rate
Up to $999	2%
$1,000 - $5,999	4%
$6,000+	5%

Capital Gains Tax

Capital gains are taxed at the same rates as ordinary income.

Deductions & Exemptions

Type	Amount
Standard Deduction (Single)	$3,000
Standard Deduction (Married Filing Jointly)	$8,500
Personal Exemption (Single)	$1,500
Personal Exemption (Married)	$3,000
Dependent Exemption	$1,000

Additional Information

Federal income tax deduction allowed
Rates unchanged for 2026: 2% on the first $500 ($1,000 married filing jointly), 4% on the next $2,500 ($5,000), 5% above $3,000 ($6,000)
Standard deduction shown is the maximum; it phases down with Alabama AGI to $2,500 single / $5,000 married filing jointly at AGI of $35,500 or more
Dependent exemption is $1,000 per dependent if Alabama gross income is $50,000 or less, $500 from $50,001 to $100,000, and $300 above $100,000

Charts

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Sources

The 2026 figures for Alabama on this page were compiled from the following official government publications:

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Last updated: September 15, 2026

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