Alabama State Business Tax return

[markK2]

Does my LLC formed in Louisiana and conducting business in Alabama need to file a state tax return in Alabama? Privilege Tax?

[AliciaP1 · Accepted solution]

Yes, you need to file the AL Privilege Tax, but will not need to file an AL state tax return as long as your business files as a disregarded entity.  If your LLC is required to file as a partnership or elects to file taxes as an S-Corp, then the LLC is also required to file the corresponding state tax return in AL.

[markK2]

Thanks for the help. Can you help me with more?

Background:

My LLC is based in Louisiana but the only business we do is in Alabama (Beach Condo Rental). The LLC is a pass-through partnership between myself and my brother. The LLC had a loss on our LLC Federal return. We started the LLC in June 2022.

Several questions:

If I ordered the Alabama state return for Turbo-Tax (already have the Turbo-Tax Business program), would I be able to complete all below (BPT and State Business Return if needed)?

Alabama states the Initial BPT is due within 2.5 months "after date of qualification". Does this mean I should have filed the Initial BPT back in August 2022? And should I also file one for 2023 (CPT)?

Does the LLC or my brother and me need to file a state tax return in Alabama (not referring to the BPT)?

[PatriciaV · Accepted solution]

According to this list, all the business forms you noted are available in the Alabama State business return module. TurboTax will help you file the correct forms needed for 2022. The Business Privilege Tax Return and annual report is filed every year your business is registered with the state.

Pass-through income is reported on the member/partner tax return for their resident state. No Alabama State tax return is filed by the members/partners unless they are Alabama residents or have other Alabama-sourced income.

[markK2]

Thank You SO much for the help, Alicia and Patricia.