Alabama Paycheck Calculator

Alabama taxes income on a graduated state schedule for 2026, applied after the state deduction for your filing status. This calculator applies that on top of federal withholding and Social Security / Medicare to estimate your Alabama take-home pay.

Alabama uses a graduated income tax with 3 brackets for 2026, with marginal rates ranging from 2% to a top rate of 5% (which applies to single-filer taxable income above $3,000). For 2026, Alabama's state standard deduction plus personal exemption is $4,500 for single filers and $11,500 for married couples filing jointly, shrinking as income rises to $4,000 and $8,000 from $35,500 of income. When working out its taxable income, Alabama also lets you subtract all of the federal income tax you owe, with no cap. The figures here include it. As a worked example, a single filer earning $60,000 pays about $2,509 in Alabama income tax (roughly 4.2% of gross) before federal tax and FICA.

What this estimate doesn't include: Alabama's standard deduction shrinks as income rises, and this estimate follows Alabama's own chart: a single filer gets $3,000, reduced by $25 for each full $500 of Alabama adjusted gross income over $25,500, and $2,500 from $35,500 up. Married filing jointly goes from $8,500 down to $5,000, and head of family from $5,200 down to $2,500, over the same income range. This estimate also includes Alabama's personal exemption, which does not shrink with income: $1,500 single, $3,000 married filing jointly and $3,000 head of family. The amounts shown combine it with the standard deduction, so a single filer's goes from $4,500 down to $4,000. The dependent exemption is not modeled. Local income taxes are not included. Some Alabama cities levy a separate LOCAL occupational tax on wages (for example 1% in Birmingham and 2% in Gadsden) that is not included in this estimate. Alabama lets you deduct all of the federal income tax you owe, with no cap, and this estimate applies it. It uses the federal income tax this estimate works out from your pay, so other income or credits on your real return would change it. The Alabama tax in this estimate does not include Alabama's 2026 overtime deduction, because you claim it on your Alabama return when you file and it does not change what comes out of your paychecks. It lets you deduct the extra part of your overtime pay above your normal rate (the "half" in time and a half), up to $1,000 a year. The overtime question on the Alabama paycheck calculator works out what it saves you at filing. City, county or school-district income taxes where they apply, court-ordered deductions, union dues, and anything else your specific employer withholds are not in this figure; your pay stub is the authority on those.

Alabama's graduated single-filer schedule for 2026, applied after the state deduction:

• Alabama lets taxpayers deduct their full federal income tax liability before computing state tax (a 1965 constitutional provision) — one of the very few states still allowing a full federal income tax deduction, which meaningfully lowers effective state withholding.
• Workers in some Alabama cities, such as Gadsden (2%) and Birmingham (1%), have a city occupational tax withheld from every paycheck on top of the 2% to 5% state income tax. It is a local deduction that people from other states rarely expect.

Some Alabama cities levy a local occupational tax that the employer withholds from the wages of people who work in the city, residents or not. Birmingham's rate is 1% and Gadsden's is 2%. The Alabama Department of Revenue does not collect these taxes; each city or county that levies one runs it.

For tax years 2025 to 2028 there is a federal deduction for qualified overtime premium pay and tips (OBBBA caps & rules). FICA comes out either way.

Alabama state income tax: Alabama does not follow the full federal overtime deduction, but it has a smaller one of its own for tax years 2026 through 2028 (Act 2026-604). You can deduct the extra part of your overtime pay above your normal rate, the "half" in time and a half, up to $1,000 a year, on your Alabama return. You claim it when you file, so it does not change your paychecks. Because Alabama also lets you subtract your federal income tax, the federal overtime deduction raises your Alabama tax by about 5 cents per dollar it saves you, which can outweigh what this $1,000 deduction saves you. Tips get no Alabama deduction, and the federal tips deduction raises your Alabama tax the same way. Alabama's earlier, full overtime exemption ended June 30, 2025. (source: revenue.alabama.gov)

• Overtime: 2025 — not deductible on your Alabama return (still state-taxed); 2026–2028 — Alabama's own deduction of up to $1,000 of the overtime premium.
• Tips: 2025 — not deductible on your Alabama return (still state-taxed); 2026–2028 — not deductible on your Alabama return (still state-taxed).

Related: overtime by state · overtime calculator · tips by state · tips calculator.

$7.25/hour (≈$15,080/year full-time). Alabama has NO state minimum wage law; FLSA-covered workers default to the federal $7.25/hr.