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NOTICE Alabama Rental Tax Guidance for Rental Facilitators

  • February 11, 2022

Persons or entities that facilitate third-party rental transactions of Class II or Class IV property,
as defined in Section 40-8-1, Code of Alabama 1975, are designated as rental facilitators. Rental
facilitators are required to collect and remit rental tax for leases made to Alabama customers or
comply with the notice and reporting requirements.

Rental facilitators must apply for a special rental tax account with the department to comply with
remittance or reporting requirements (application included with this notice). If the rental
facilitator chooses to comply with the notice and reporting requirements in lieu of collecting and
remitting rental tax, an annual informational reporting requirement with the department along
with an annual transaction summary notice provided to each third-party owner/lessor who
engaged in transactions facilitated by the facilitator for the lease or rental of Class II or Class IV
property are required. The annual informational report required to be filed with the department
must be filed electronically by January 31 of the calendar year succeeding the year for which the
report is provided. The annual informational report must be submitted through the department’s
online filing portal at https://myalabamataxes.alabama.gov. It is recommended that a statement
be included on the lease contract, or in another form that is readily available to each third-party
owner/lessor, indicating whether or not the facilitator is collecting Alabama rental tax for the
transactions in which they facilitate.

Contact the Sales and Use Tax Division at 334-242-1490 or 1-866-576-6531 if you have questions
or need assistance applying for the appropriate rental tax account.

Download a PDF of this notice and the tax account application.