Alabama Minimum Wage and Income Tax 2026
What it costs to pay people and earn money in Alabama.
Minimum wage$7.25per hour
Income tax2.00% to 5.00%
State sales tax4.00%about 9.46% with local tax
Corporate tax6.50%
Minimum wage in Alabama
The minimum wage is $7.25 an hour, the same as the federal rate. No state minimum wage law. The federal $7.25 applies to employers covered by federal law.
Full time at 40 hours, that is $290 a week or $15,080 a year. It ranks 32 of 51, higher than 0 others.
As of July 1, 2026. Source: U.S. Department of Labor.
Income tax in Alabama
Alabama income tax runs from 2.00% to 5.00% across 3 brackets.
The top rate ranks 23 of 51.
Single filers, as of January 1, 2026. Source: Tax Foundation.
Corporate tax in Alabama
The top corporate income tax rate is 6.50%.
It ranks 22 of 51.
As of April 2, 2026. Source: Tax Foundation.
Sales tax in Alabama
The state rate is 4.00%. With the average local tax, shoppers pay about 9.46%.
As of July 1, 2026. Source: Tax Foundation.