Transient Occupancy Tax.

Ala. Code tit. 40, ch. 26

in effect

Ala. Code § 40-26-1 Tax Imposed; Exemptions; Definitions.

40-26-1. Tax Imposed; Exemptions; Definitions. (a) There is levied and imposed, in addition to all other taxes of every kind now imposed by law, a privilege or license tax upon every person, firm, or corporation engaging in the business of renting or furnishing any room or rooms, lodging, or accommodations to transients in any hotel, motel, inn, tourist camp, tourist cabin, marine slip, place or space for tent camping, place or space provided for a motor home, travel trailer, self-propelled camper or house car, truck camper, or similar recreational vehicle commonly known as a R.V., or any other place in which rooms, lodgings, or accommodations are regularly furnished to transients for a consideration, in any county which is located in the geographic region comprising the Alabama mountain lakes area, those being Blount, Cherokee, Colbert, Cullman, DeKalb, Etowah, Franklin, Jackson, Lauderdale, Lawrence, Limestone, Madison, Marion, Marshall, Morgan, and Winston, in an amount to be determined by the application of the rate of five percent of the charge for such room, rooms, lodgings, or accommodations, including the charge for use or rental of personal property and services furnished in such room, and the rate of four percent of the charge in every other county. There is exempted from the tax levied under this chapter any rentals or services taxed under Division 1 of Article 1 of Chapter 23 of this title. (b) The tax shall not apply to rooms, lodgings, or accommodations supplied: (i) For a period of 180 continuous days or more in any place; (ii) by camps, conference centers, or similar facilities operated by nonprofit organizations primarily for the benefit of, and in connection with, recreational or educational programs for children, students, or members or guests of other nonprofit organizations during any calendar year; or (iii) by privately operated camps, conference centers, or similar facilities that provide lodging and recreational or educational programs exclusively for the benefit of children, students, or members or guests of nonprofit organizations during any calendar year. (c) For purposes of subsection (b): “Children” means individuals under age 21; “student” is defined in accordance with 26 U.S.C. § 151(c)(4), as in effect from time to time or by any successor law; “nonprofit organization” is an organization exempt from federal income tax under 26 U.S.C. § 501(c)(3), as in effect from time to time or any successor law; and “privately operated” refers to any camp, conference center, or similar facility other than those operated by a nonprofit organization as herein defined. (d) For transactions entered into on or after October 1, 2019, the tax shall not apply to marine slips, places or spaces for tent camping, or places or spaces provided for motor homes, travel trailers, self-propelled campers or house cars, truck campers, or similar recreational vehicles commonly known as R.V.s, which are supplied for a period of 90 continuous days or more in any place. (e)(1) Charges made for the rental of a ballroom, dining room, club room, sample room, conference room, wedding chapel, or similar room or space that is not intended nor suitable for overnight sleeping purposes and that is not used for overnight sleeping purposes is not subject to the tax levied pursuant to this chapter if the charges for the rental are separately stated by the facility and the room or space is used exclusively as a room or space for a meeting, conference, seminar, club meeting, private party, or similar activity. (2) The exclusion provided in subdivision (1) applies solely to the transient occupancy tax levied under this chapter and does not apply to any other taxes, licenses, or fees except a separately stated rental charge for a meeting room or other space excluded pursuant to subdivision (1) is also excluded from the tax levied by Chapter 23 of Title 40. (Acts 1955, No. 248, p. 586, §1; Acts 1963, No. 269, p. 715, §1; Acts 1979, No. 79-604, p. 1068, §1; Acts 1996, No. 96-498, p. 629, §1; Act 2001-968, 3rd Sp. Sess., p. 865, §1; Act 2001-975, 3rd Sp. Sess., p. 908, §6; Act 2009-144, p. 268, §12; Act 2019-387, §1; Act 2019-487, §1.)

Ala. Code § 40-26-1.1 Duties of Accommodations Intermediary; Annual Report; Exemptions.

40-26-1.1. Duties of Accommodations Intermediary; Annual Report; Exemptions. (a) This section shall be known and cited as the Alabama Tourism Tax Protection Act of 2024. (b) For the purposes of this section, the following terms have the following meanings: (1) ACCOMMODATIONS INTERMEDIARY. Any person, firm, or corporation, other than an accommodations provider, that facilitates renting, furnishing, lodging, or accommodation transactions subject to the tax levied under Section 40-26-1 and charges a room fee or an accommodations fee to the customer, which it retains as compensation for the facilitation. Facilitating transactions include brokering, coordinating, or in any other way arranging for the purchase of the right to use accommodations via a transaction directly, including via one or more payment processors, between a customer and an accommodations provider. (2) ACCOMMODATIONS PROVIDER. Any person, firm, or corporation engaging in the business of transactions subject to the tax levied under Section 40-26-1 that has an active lodgings tax account with the department and collects and remits lodgings tax on the accommodations that are rented directly by the owner of the accommodation. (3) HOTEL. Any public lodging establishment that is owned by a single entity or person; contains 15 or more individual sleeping room accommodations; offers rental units with daily or weekly rates; has a central office on the property with specified hours of operation; has a bathroom for each rental unit; is recognized as a hotel in the community in which it is situated; and possesses a permit from the Alabama Department of Public Health to operate as a hotel. (4) MERCHANT OF RECORD. The legally authorized and responsible entity that processes customer payments for the sale of goods or services within this state. (5) PROFESSIONAL PROPERTY MANAGEMENT COMPANY. A licensed real estate brokerage firm with a physical storefront location authorized and licensed under Section 34-27-30 to engage in the business of property management services on behalf of property owners. (6) ROOM CHARGE. The full retail price paid by the guest for an accommodation, including any accommodations fee and any other fees or charges. This includes the charge for use or rental of personal property and services furnished in the room or accommodation. (c) Except as provided for in subsection (d), the accommodations intermediary shall collect and remit the tax imposed pursuant to this chapter for the facilitation of lodgings transactions subject to the tax levied under Section 40-26-1, and parallel local levies, for transactions occurring on or after January 1, 2025. The tax shall be imposed on the room charge as defined in this section. (d) When an accommodations intermediary facilitates the transaction on behalf of an accommodations provider as defined in this section, the taxes collected may be remitted to the accommodations provider when there is an executed written agreement or contract specifying the responsible party for remitting the taxes. (e) An accommodations intermediary collecting and remitting taxes pursuant to subsection (d) shall not be liable for taxes not remitted by the accommodations provider to the Department of Revenue. (f) In any accommodation in which an accommodations intermediary facilitates the sale of the accommodation, the accommodations intermediary shall separately state the amount of the tax on the bill, invoice, or similar documentation and shall add the tax to the room charge; thereafter, the tax shall be a debt from the customer to the accommodations intermediary. (g) Every accommodations intermediary and accommodations provider shall annually submit a report prescribed by the Department of Revenue that includes the physical address of each accommodation that was rented or furnished greater than 14 days during the previous year. The report is confidential taxpayer information protected under this section. (h) The following entities shall be exempt from the provisions of Section 1 of this act: (1) Professional property management companies that either collect and remit the tax levied pursuant Section 40-26-1, or manage properties leased for a month or more as the principal residence of the tenant. (2) Hotels that collect and remit the tax levied pursuant to Section 40-26-1. (3) A destination marketing organization whose primary purpose is the promotion of tourism and receives funding from taxes collected and remitted pursuant to Section 40-26-1. (4) Providers of accommodations defined under subsection (d) of 40-26-1, that collect and remit the tax levied pursuant to Section 40-26-1. (i) For any accommodations transactions, subject to the tax levied in Section 40-26-1, through an accommodations intermediary where the accommodations provider has hired a professional property management company to oversee, the professional property management company shall be the merchant of record for the transactions. (j) The Department of Revenue shall adopt rules for the implementation and administration of this section. EndFragment EndFragment (Act 2024-334, §§1-3.)

Ala. Code § 40-26-2 Certain Municipal Privilege License Taxes Excluded in Computation of Tax.

40-26-2. Certain Municipal Privilege License Taxes Excluded in Computation of Tax. Municipal privilege license taxes which are levied and collected by the application of a flat percentage rate on gross sales or gross receipts from sales, and which are passed on directly by the licensee-seller to the purchaser-consumer or user shall be excluded from gross sales or gross receipts, as the case may be, in the computation of the state lodgings tax levied and imposed by this chapter. (Acts 1965, No. 788, p. 1475.)

Ala. Code § 40-26-3 Taxes Due Monthly; Filing of Reports; Election to File Quarterly, Semi-Annually, or Annually.

40-26-3. Taxes Due Monthly; Filing of Reports; Election to File Quarterly, Semi-Annually, or Annually. (a) The taxes levied under this chapter, except as otherwise provided in subsection (b), shall be due and payable in monthly installments on or before the twentieth day of the month next succeeding the month in which the tax accrues. On or before the twentieth day of each month after this chapter has taken effect, every person, firm, or corporation on whom the taxes levied by this chapter are imposed shall render to the Department of Revenue, hereinafter referred to as the department, on a form prescribed by the department, a true and correct statement showing the gross proceeds of the business for the next preceding month, together with such other information as the department may demand and require, and at the time of making such monthly report the taxpayer shall compute the taxes due and shall pay to the department the amount of taxes shown to be due. (b) Taxpayers meeting the criteria set forth in this subsection may elect to file quarterly, semi-annually, or annually. Any such election to file quarterly, semi-annually, or annually shall be made in writing no later than February 20 of each year and shall be filed with the department in the manner prescribed by the department. The department, for good cause, may extend the time for making any return required under this chapter, but the time for filing any such return shall not be extended for a period greater than 30 days from the date such return is due to be made. Qualifying taxpayers electing to file quarterly, semi-annually, or annually, shall report to the department, on a form prescribed by the department, a true and correct statement showing such information as the department may require. Qualifying taxpayers shall pay to the department the amount of tax shown to be due on or before the applicable deadlines, under any rules as may be prescribed, as follows: (1) When the total state transient occupancy tax for which any person is liable under this chapter is less than two thousand four hundred dollars ($2,400) during the preceding calendar year, the person may elect to file quarterly returns. Quarterly returns and the amount of tax shown to be due shall be due on or before the 20th day of the month next succeeding the end of the quarter for which the tax is due. (2) When the total state transient occupancy tax for which any person is liable under this chapter is less than one thousand two hundred dollars ($1,200) during the preceding calendar year or the person liable for the tax has provided accommodations during no more than two, 30 consecutive day periods during the preceding calendar year, the person may elect to file semi-annual returns. The semi-annual returns and payment of the tax shown to be due shall be due on or before July 20 and January 20 following the end of the six-month period for which the tax is due. (3) When the total state transient occupancy tax for which any person is liable under this chapter is less than six hundred dollars ($600) for the preceding calendar year or the person liable for the tax provides accommodations during no more than one, 30 consecutive day period during the preceding calendar year, the person may elect to file an annual return. The annual return and payment of the tax shown to be due shall be due on or before January 20 following the end of the annual period for which the tax is due. (Acts 1955, No. 248, p. 586, §2; Act 2019-253, §1.)

Ala. Code § 40-26-4 Cash and Credit Businesses.

40-26-4. Cash and Credit Businesses. Any person, firm or corporation taxable under this chapter having a cash and credit business may report such cash business and the taxpayer shall thereafter include in each monthly report all credit collections made during the month preceding and shall pay the taxes due thereon at the time of filing such report, but in no event shall the gross proceeds of such credit business be included in the measure of the tax to be paid until collections of such credit business shall have been made. (Acts 1955, No. 248, p. 586, §3.)

Ala. Code § 40-26-5 Annual Return and Payment.

40-26-5. Annual Return and Payment. On or before 30 days after the end of the tax year, each person, firm or corporation liable for the payment of a privilege tax as levied by this chapter shall make a return showing the gross proceeds of business done and compute the amount of tax chargeable against him or it in accordance with the provisions of this chapter and deduct the amount of monthly payments as hereinbefore provided, if any have been made, and transmit with this report a remittance in the form required by this chapter covering the residue of the tax chargeable against him, to the office of the department, and such report shall be verified by oath. (Acts 1955, No. 248, p. 586, §4.)

Ala. Code § 40-26-7 Verification of Reports.

40-26-7. Verification of Reports. The monthly reports herein required to be made are not required to be made on oath, but wherever in this chapter any report is required to be sworn to, the same shall be sworn to by the taxpayer or his agent before some officer authorized to administer oaths; and any false statement of a material fact made with intent to defraud shall constitute perjury, and upon conviction thereof the person so convicted shall be punishable as provided by law. (Acts 1955, No. 248, p. 586, §6.)

Ala. Code § 40-26-8 Failure to Make Reports and Keep Records.

40-26-8. Failure to Make Reports and Keep Records. Any person, firm or corporation subject to the provisions of this chapter who fails to make the reports or any of them as herein required, or who fails to keep the records as herein required, shall be guilty of a misdemeanor and upon conviction shall be fined not less than $25 nor more than $500 for each offense. Each month of such failure shall constitute a separate offense. (Acts 1955, No. 248, p. 586, §7.)

Ala. Code § 40-26-9 Willful Refusal to Make Reports or Permit Examination of Records.

40-26-9. Willful Refusal to Make Reports or Permit Examination of Records. Any person, firm or corporation subject to the provisions of this chapter willfully refusing to make the reports herein required, or who shall refuse to permit the examination of his or its records by the Department of Revenue, or its duly authorized agents, shall be guilty of a misdemeanor, and upon conviction shall be fined not less than $50 nor more than $500 for each offense, and in addition may be imprisoned in the county jail for a period not to exceed six months. Each month of failure to make such report shall constitute a separate offense and each refusal of a written demand of the department to examine, inspect or audit such records shall constitute a separate offense. (Acts 1955, No. 248, p. 586, §8.)

Ala. Code § 40-26-16 Failure to Add Tax to Price of Service; Refund or Absorption of Tax Prohibited.

40-26-16. Failure to Add Tax to Price of Service; Refund or Absorption of Tax Prohibited. It shall be unlawful for any person, firm or corporation engaged in or continuing within this state in any business for which a license or privilege tax is required by this chapter to fail or refuse to add to the price of the service rendered the amount due by the taxpayer on account of the tax levied by this chapter. Nor shall any person refund or offer to refund all or any part of the amount collected as tax under this chapter or to absorb such tax or to advertise directly or indirectly the absorption or refund of such tax or any portion of the same. Any person, firm or corporation violating any of the provisions of this section shall be guilty of a misdemeanor and upon conviction shall be fined in a sum not less than $50 nor more than $100, or may be imprisoned in the county jail for not more than six months, or by both such fine and imprisonment, and each act or violation of the provisions of this chapter shall constitute a separate offense. (Acts 1955, No. 248, p. 586, §15.)

Ala. Code § 40-26-17 Violators Restrained from Continuing in Business.

40-26-17. Violators Restrained from Continuing in Business. Any taxpayer who shall violate any of the provisions of this chapter may be restrained from continuing in business, and the proper prosecution shall be instituted in the name of the State of Alabama by its Attorney General, by the counsel of the department or under their direction by any district attorney of the state until such person shall have complied with the provisions of this chapter. (Acts 1955, No. 248, p. 586, §16.)

Ala. Code § 40-26-18 Administration of Chapter.

40-26-18. Administration of Chapter. The administration of this chapter is vested in and shall be exercised by the Department of Revenue, except as otherwise herein provided, and the enforcement of any of the provisions of this chapter in any of the courts of the state shall be under the jurisdiction and supervision of the department, and the department may require the assistance of, and act through the district attorney of any county and the Attorney General of the state and any legal counsel of the Department of Revenue. The department shall appoint as needed such agents, clerks and stenographers as may be necessary to enforce the provisions of this chapter under the provisions of the merit system who shall perform such duties as may be required, and such duly appointed and qualified agents are authorized to act for the department as it may direct and as is authorized by law. (Acts 1955, No. 248, p. 586, §17.)

Ala. Code § 40-26-19 Rules and Regulations.

40-26-19. Rules and Regulations. The department shall from time to time promulgate such rules and regulations for making returns and for ascertainment, assessment and collection of the tax imposed hereunder as it may deem necessary to enforce the provisions of this chapter, and upon request shall furnish to the taxpayer a copy of such rules and regulations. (Acts 1955, No. 248, p. 586, §18.)

Ala. Code § 40-26-20 Disposition of Proceeds of Tax.

40-26-20. Disposition of Proceeds of Tax. One-fifth of the proceeds of the tax levied by this chapter in counties which are members of the Alabama Mountain Lakes Association, after deduction of an agreed upon cost of collection between the counties involved and the state Department of Revenue, such cost of collection not to exceed five percent, shall be appropriated in the following manner: Fifty percent of said portion shall be appropriated to the Alabama Mountain Lakes Association to be used for promotion of tourism and travel. The remaining fifty percent of said portion shall be paid to the respective counties to be used for the promotion of tourism, recreation and conventions. Said money shall be controlled by the county commission unless local law provides otherwise. The balance of all taxes or other funds received or collected by the department under the provisions of this chapter shall be without delay deposited in the State Treasury. Three-fourths of said balance of the revenue derived under this chapter shall be deposited into the State General Fund, and the remaining one-fourth shall be used exclusively for state travel advertising and travel promotion by the State Bureau of Tourism and Travel from the appropriation made by the Legislature. (Acts 1955, No. 248, p. 586, §19; Acts 1963, No. 269, p. 715, §2; Acts 1979, No. 79-604, p. 1068, §2; Acts 1988, 2nd Ex. Sess., No. 88-956, p. 681.)

Ala. Code § 40-26-21 Allowance of Discount of Taxes.

40-26-21. Allowance of Discount of Taxes. The Governor may, by executive order, authorize the state Department of Revenue to provide by proper rules and regulations for the allowance of a discount of taxes due and payable to the state by persons subject to the lodgings tax levied by this chapter, in the same manner and to the same extent as the discount allowed persons licensed under the provisions of Division 1 of Article 1 of Chapter 23 of this title. The discount provided for herein shall not exceed five percent of the first $100 of taxes levied and two percent of the taxes levied over $100 and due and payable to the state by persons subject to this chapter. It is provided, however, that the discount provided for herein shall be authorized or allowed only upon taxes which are paid before delinquency. (Acts 1956, 1st Ex. Sess., No. 96, p. 142.)

Source: Alabama Legislature (alison.legislature.state.al.us)URL: https://alison.legislature.state.al.us/code-of-alabamaFetched: 10/20/2026