Alabama: 3rd-Party Setup & Understanding Alabama Tax Account Types

Provide Taxually with the following information to complete your Onboarding

Required Information

We will need the following information from you:

• Alabama Account ID (Format: ABC-R012345678)
• Sign-On ID
• Access Code
• Third Party Password
• + Ensure third-party access settings are set to Allowed: Yes

NOTE: The third-party access setup must be completed by a user who has permission to manage other users on your business’s MAT account. 

Step 1: Provide Account ID

• Log in to MAT

• Check under Accounts tab to find your Account ID

Step 2: Provide Sign-On ID and Access Code

These credentials were provided when your MAT account was originally created. If you don't have this information:

• In your MAT account, from the home page, click Manage My Profile 
• Click the Other Actions tab
• Click the View MAT messages under the MAT Messages Section
• Click the Send a MAT message to ALDOR link (above the received/sent menu bar) and follow the prompts
• Example Message: "I would like to assist a third-party agent in gaining access to our sales and use tax account, but we misplaced our Sign-On ID and Access Code that was assigned when we created our account. Could you please provide [Business Name]’s Sign-On ID and Access Code? Thank you."

Step 3: Third-Party Access Password and Settings

• Log in to MAT

• Confirm Third-Party Access is enabled:

  • Click the Manage My Profile link

  • Click the Other Actions tab

  • Click the Manage third-party access to my accounts link in the Access Management Section

  • Change the settings to the following:

    • Allowed: Yes

    • Default Account Access: File & Pay

  • Third Party Password

    • If no password exists: Create a new third-party password and enter it in the Taxually onboarding process

    • If a password already exists: Enter the existing password in the Taxually onboarding process

  • Can’t find these settings? You likely don't have "Full Access" privileges if you cannot locate or manage these settings. To verify and find the correct user:

    • Option 1: 

      • From the MAT home page, click the Other Actions menu tab

      • Click View Access

      • Look for the user listed with "FullAccess" - this person needs to complete the setup

    • Option 2: 

      • Click Manage My Profile

      • Click Other Actions tab

      • Click Manage my access to tax accounts and/or  Manage third-party access to my accounts

      • Find the person with "Full Access" listed as the "General Access"

What happens next

• Taxually will complete third party access using the information you provided.

• Taxually will confirm if the access is successful or contact you if they require additional information.

Additional Information Below

Physical Presence in Alabama?

• Do you have a physical presence in Alabama?

  • This includes:

    • Inventory stored in Alabama

    • Offices or facilities

    • Employees

    • Any other significant recurring contact with Alabama

• If you do not have a physical presence, we recommend switching to the Simplified Sellers Use Tax account to avoid complex local tax registration requirements. Please see the section below for additional information on this

Should You Switch to a Simplified Sellers Use Tax Account?

Understanding Alabama Tax Account Types

Sales Tax Account

• Purpose: For businesses with physical locations in Alabama, selling tangible personal property

• Best for: Retailers with inventory in Alabama or storefronts, warehouses, or offices

• Requirement: Must also register for Local Tax account to collect local taxes

Sellers Use Tax Account

• Purpose: For out-of-state businesses with physical nexus in Alabama

• Physical nexus includes: Sales offices, agents, inventory, employees, or significant recurring contact

• Requirement: Must also register for Local Tax account to collect local taxes

Local Tax Account

• Purpose: Collects varying local sales taxes for 200+ Alabama jurisdictions

• Challenge: Alabama doesn't administer all local taxes, requiring separate registrations with individual localities

• Trigger: Collecting local taxes may require registration with each non-state-administered locality

Simplified Sellers Use Tax Account ⭐ Recommended for Remote Sellers

• Purpose: Streamlined option for businesses without an Alabama physical presence

• Rate: Flat 8% tax on all Alabama sales

• Benefits:

  • Only one tax return to file (vs. separate state and local returns)

  • No individual local registrations required

  • Simplified compliance

  • Reduced administrative burden

Important Considerations for Local Tax Accounts

Warning for Businesses Collecting Local Taxes:

If you currently have a Local Tax Account and collect taxes in non-state-administered localities, you may be required to register separately with each locality once sales are reported. This creates:

• Multiple registration requirements

• Additional compliance obligations

• Increased administrative complexity

• Potential penalties for non-compliance

For remote sellers without physical presence in Alabama: We strongly recommend switching to the Simplified Sellers Use Tax account to avoid these complications.

Making the Switch

If you determine that Simplified Sellers Use Tax is right for your business, we can request this change for you during onboarding unless you specifically indicate otherwise. This switch will:

1. Simplify your tax compliance

2. Reduce filing requirements from multiple returns to one

3. Eliminate local registration triggers

4. Apply a consistent 8% rate to all Alabama sales

Need help?

We are here to support you! Please contact us