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LABAMA

EPARTMENT OF

EVENUE

Instructions For The Preparation Of The

FORM

Alabama Business Privilege Tax,

2000

PSI

Corporate Shares Tax Return and Annual Report

1/2000

The Alabama Business Privilege and Corporate Shares Tax Act of 1999 (Act 99-665) and

tax forms may be viewed and downloaded at the Department of Revenue Web site at

I. General Instructions

• A copy of the appropriate apportion-

to both the privilege tax and the corporate

ment schedule.

shares tax. Taxpayers paying 90% of the

Every corporation, limited liability entity,

• Schedule showing calculation of Fed-

actual tax liability with a valid extension

business trust, disregarded entity and real

eral taxable income in Alabama

request will not be subject to this penalty.

estate investment trust that is doing busi-

• Documentation to validate all exclu-

Interest. Interest is due on all pay-

ness in Alabama or is registered/qualified

sions and deductions claimed.

ments made after March 15, 2000. The

to do business in Alabama on January 1,

NOTE: When information from a feder-

interest rate is the same as provided in

2000, is required to file an Alabama Busi-

Code of Alabama 1975 , Section 40-1-44.

al or state income tax return is required,

ness Privilege Tax and Corporate Shares

do not attach the entire federal or state

If assistance is needed in computing

Tax Return and Annual Report. The due

income tax return.

the penalty and/or interest amounts call

date for filing the return is March 15th. If

(334) 353-7923. The examiner that will

III. Extension Request

additional time is needed, an extension for

assist you will need to know the tax liabili-

no more than six months may be request-

(Form PSE)

ty and the date the return will be mailed.

ed by completing an Extension Request

Requirements for an extension to be

VI. Prior Year Credits

for the Alabama Business Privilege Tax

granted:

Return, Corporate Shares Tax Return, and

Franchise Tax credits will not be

• A payment of 90% of the taxes due or

Annual Report (Form PSE). See instruc-

allowed against the liabilities of the new

$100, whichever is greater, must be

tion III below.

Alabama Business Privilege or Corporate

made with the extension request. Cor-

Nonprofit corporations described under

Shares Taxes.

Franchise tax overpay-

porations are also required to include

26 U.S.C. Section 501(a) are exempt from

ments will be refunded.

the $10 Secretary of State fee.

filing and paying the Alabama Business

• The extension request must be mailed

VII. Instructions For

Privilege and Corporate Shares Taxes.

on or before March 15, 2000.

The determination date for the tax is

Schedule A, Form PSA

• The extension request must be complet-

January 1, 2000. The taxpayer should use

Line 1

ed in its entirety.

their December 31, 1999, year-end finan-

• The extension request must be signed.

Enter the outstanding capital stock and

cial statements to calculate these taxes. A

additional paid in capital. This amount

taxpayer may use fiscal year financial

IV. Initial Returns

cannot be reduced by treasury stock.

statements for the last fiscal year-end pre-

An initial return is the first return due

( Code of Alabama 1975 , Section 40-14A-

ceding January 1, provided such figures

23(a)(1))

after the taxpayer incorporates, registers,

reasonably reflect the taxpayer’s business

organizes, qualifies, or begins doing busi-

Line 2

activity in Alabama as of January 1.

ness in Alabama, whichever occurs first.

Enter the amount of appropriated and

The return must be signed, all applica-

The return is due two and one half months

unappropriated retained earnings, but not

ble sections and schedules must be com-

after such occurrence. Schedule E (Initial

less than zero. This amount shall include

pleted and all required attachments must

the balance of any dividend payables on

Privilege Tax Calculation) is to be com-

accompany the return in order for the

pleted only by taxpayers that incorporated,

the taxpayer’s year-end balance sheet.

return to be considered complete. Incom-

registered, organized, qualified, or began

(Section 40-14A-23(a)(2))

plete returns received by the Department

doing business in Alabama AFTER Janu-

Line 3

will not be considered as timely filed and

ary 1, 2000.

For Corporations only,

Subtract the sum of Schedule A, Lines

will be subject to applicable penalties and

1 and 2 from the sum of Schedule C, Lines

Schedule F is also required to be complet-

interest.

ed on all initial returns.

11b and 11c and enter the total. Do not

Taxpayers will continue to incur a new

enter an amount less than zero. (Section

tax liability each year on January 1 unless

V. Penalties and Interest

40-14A-23(e)(2)a)

the taxpayer takes the appropriate steps

Failure to timely file return – If a

Line 4

to legally cease their existence in the

return is filed after the due date, there will

Add to net worth the sum of compen-

State of Alabama. Contact the Secretary

be assessed a late filing penalty of 10% of

sation or similar amounts paid or accrued

of State’s office at (334) 242-5324 or

the tax due or $50, whichever is greater.

to a direct or indirect shareholder owning

for instructions con-

This penalty applies separately to both the

more than 5% of the corporation the

cerning these requirements.

privilege tax and the corporate shares tax.

amount exceeding $500,000. See Code

Electronic funds transfers (EFT) are

Failure to timely pay tax – If payment

of Alabama 1975 , Section 40-14A-

not available for business privilege and

corporate shares tax.

is not received by the due date, there will

23(f)(1) a, b, and c at the Department’s

be assessed a late payment penalty of 1%

Web site for further information.

II. Required Attachments

per month, or fraction thereof, of the

Line 5

• Pages 1 through 4 of the uncon-

amount of the tax due, not to exceed 25%

Add to net worth the sum of compen-

solidated federal tax return.

of the tax. This penalty applies separately

sation, distributions, or similar amounts

Form Psi 1/2000 - Instructions For The Preparation Of The Alabama Business Privilege Tax, Corporate Shares Tax Return And Annual Report - 2000

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