Alabama Exemption Amounts

Alabama provides personal exemptions and dependent exemptions that reduce Alabama taxable income for individual income tax purposes. These exemptions are claimed on Form 40 or Form 40NR and are determined under Alabama law, including statutory amounts and eligibility limitations based on filing status and adjusted gross income (AGI).

Dependent Exemption Amounts

Alabama allows a dependent exemption for each qualifying dependent claimed on the return.

Alabama uses its own dependent definition, which differs from federal rules. A qualifying dependent must meet all of the following requirements:

• The person is not the taxpayer or spouse.
• The taxpayer provided more than 50% of support.
• The person meets Alabama's relationship requirements.

Dependent Exemption Amount (per dependent):

• $1,000 — Alabama Adjusted Gross Income of $0 to $50,000
• $500 — Alabama Adjusted Gross Income of $50,001 to $100,000
• $300 — Alabama Adjusted Gross Income over $100,000

Personal Exemption Amounts

Alabama allows a personal exemption for the taxpayer and, if applicable, a spouse, based on filing status.

Personal Exemption Amounts:

• Single / Married Filing Separately: $1,500
• Married Filing Jointly / Head of Family: $3,000

A taxpayer who is claimed as a dependent on another taxpayer’s return is not entitled to claim a personal exemption on their own Alabama return. Part-year residents are generally allowed the full personal exemption, subject to Alabama residency allocation rules. Nonresidents must prorate personal exemptions based on the ratio of Alabama-source income to total income, as computed under Form 40NR instructions.

Special Rules

• Per What personal exemptions am I entitled to? - Alabama Department of Revenue Part year residents are entitled to the full exemption amount.
• A dependent or student may claim a personal exemption even if claimed by someone else. Per 40 Booklet TY 2025_12-9-25_D.pdf
• No personal exemption or dependent exemption can then be claimed on the nonresident return (Form 40NR).
• Exemptions are reported in the exemptions section of Form 40 or Form 40NR and are used in computing Alabama taxable income.

Source:
Form 40.pdf
Form 40NR.pdf
Schedule RS.pdf

Disclaimer: Always verify details with the most current Alabama Department of Revenue forms and instructions. Tax rules may change annually. For complex situations, consult a CPA or tax professional.