Alabama Tax Rebate Checks Are Now Being Sent

Alabama tax rebate checks are on the way. Here's who will receive one and when to check your bank account.

Alabama State Capitol in Montgomery, Alabama.
(Image credit: Getty Images)

Alabama tax rebate checks are now on the way to approximately 1.9 million state residents.  After changing the rebate amounts twice, Alabama lawmakers eventually settled on one-time payments of up to $300. 

"Thanks to our unwavering commitment to fiscal responsibility, one-time tax rebates will be with our hard-working Alabamians in time for the holidays,” said Gov. Kay Ivey, reminding taxpayers about the payments.

However, not all Alabamians are eligible for a tax rebate check, and not every eligible resident will receive the same amount. 

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Here's what you should know.

When will Alabama tax rebate checks be deposited?

Some qualified Alabama residents may have already seen their rebate payments hit their bank accounts. The payments will be sent to the bank account listed on your 2021 Alabama state tax return. 

  • If you didn’t list a bank account on your tax year 2021 return, Alabama will mail your tax rebate as a paper check.
  • You will not need to pay Alabama income tax on your 2023 tax rebate payment.
  • Your rebate is not subject to debt collection or an offset. This means that if you owe state taxes or have or have other state debts, your rebate won’t be reduced.

Who will receive an Alabama tax rebate in 2023? 

Not everyone will receive a $300 Alabama tax rebate check. That's because payment amounts are based on the state filing status of Alabama residents for the 2021 tax year.

  • If your filing status was married filing jointly, you will receive a $300 tax rebate payment.
  • If you filed as single, head of family, or married filing separately, you will receive a $150 tax rebate payment.

Who doesn’t qualify for the Alabama tax rebate? If you didn’t file a personal Alabama income tax return for the 2021 tax year, you will not qualify for the 2023 Alabama tax rebate check. Estates and trusts are not eligible to receive the payments. Additionally, you won't receive a rebate payment if you were claimed as a dependent on a 2021 federal or Alabama state income tax return.

What is the $400 rebate in Alabama?

Gov. Ivey proposed one-time $400 tax rebates for single, head of family, and married filing separately filers earlier this year. Under Ivey’s original proposal, joint filers would have received $800 payments. However, a state Senate committee proposed smaller payments of $105 and $210, respectively. 

The Alabama House proposed doubling that amount, but the proposal failed to advance. A conference committee approved a compromise of $150 (for individual taxpayers) and $300 (for joint filers), which eligible Alabama taxpayers will receive. So, there is no $400 rebate in Alabama for 2023. 

Why is Alabama sending rebate checks?

Alabama isn’t the only state sending these so-called “stimulus” payments in 2023. Earlier this year, Minnesota approved one-time rebate checks.  And New Mexico approved tax rebates that were sent over the summer.

Alabama residents are receiving rebate checks to help offset the grocery taxes they paid in 2021. Alabama is one of the few states in the U.S. that taxes groceries. Grocery taxes in the state are largely allocated for public schools through the Education Trust Fund. The money needed to send taxpayers the Alabama rebate payments will be transferred from this fund. 

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Katelyn Washington
Tax Writer

Katelyn has more than 6 years’ experience working in tax and finance. While she specializes in tax content, Katelyn has also written for digital publications on topics including insurance, retirement and financial planning and has had financial advice commissioned by national print publications. She believes that knowledge is the key to success and enjoys helping others reach their goals by providing content that educates and informs.