HB540 Alabama 2012 Session

Summary

Primary Sponsor

Steve HurstRepresentative

Republican

Co-Sponsors

Randy WoodDuwayne BridgesRichard J. LairdAlan Boothe

Session

Regular Session 2012

Title

Sales tax, estimated payments, average monthly tax liability threshold increased, Sec. 40-23-7 am'd.

Summary

HB540 raises the threshold for required estimated monthly state sales tax payments from $1,000 to $2,500 based on prior year's average monthly liability.

What This Bill Does

It changes when taxpayers must begin making estimated monthly payments. Only those with an average monthly state sales tax liability of $2,500 or more would be required to make estimated payments. Taxpayers with lower average liabilities would not be required to make estimated payments and may still file monthly or, if eligible, quarterly, under existing provisions. The bill retains the existing rules for calculating estimated payments and the quarterly option for very small liabilities, and it takes effect September 1, 2012.

Who It Affects

• Taxpayers (businesses or individuals) whose average monthly state sales tax liability is $2,500 or more and would be required to make estimated monthly payments.
• Taxpayers whose average monthly liability is below $2,500 (including those with very small average liabilities who may elect quarterly filing) who would not be required to make estimated payments but would continue to file and pay as due.

Key Provisions

• Amends Section 40-23-7 to raise the estimated-payment eligibility threshold from $1,000 to $2,500 in average monthly state sales tax liability.
• Maintains the monthly reporting and payment schedule for those subject to the estimated-payment rule, including the calculation method: the first estimated payment is 66 2/3 percent of the tax liability for October 1983; subsequent payments are the lesser of 66 2/3 percent of the liability for the same month of the preceding year or 66 2/3 percent of the current month's estimated liability.
• Preserves the quarterly filing option for taxpayers with average monthly liability under $200, to be elected in writing by February 20 each year.
• Keeps existing provisions about due dates and the rule that no return is due until January 20 of each year unless the prior year liability exceeds $10.
• Effective date: September 1, 2012.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation