Last updated
Alabama puts the license in the county, not in a state office. The Secretary of State forms your LLC. The Department of Revenue guides the counties and collects the tax. The county probate office handles the license.
What is an Alabama privilege license?
The Department of Revenue's business licensing FAQ defines it. A privilege license is a requirement for every person, firm, company or corporation engaged in a business, vocation, occupation or profession described in Title 40, Chapter 12 of the Code of Alabama 1975.
Its business licensing page says state and county business privilege licenses are issued through the local county probate offices. Those offices handle new licenses, renewals, transfers, copies and other changes. The License Section of the Department guides the counties.
Where do you buy it and how often?
You buy it from the county Probate Judge or License Commissioner in the county where the business is located. If you operate in more than one county, the FAQ says a license is required in every county where the business is conducted, unless otherwise provided.
The annual license covers October 1 through September 30. You renew during October, and the license is delinquent on November 1. Fees vary with the type of license. In some cases they also depend on the population of the area or the volume of business. We did not read a fee table, so we quote none.
What about city licenses?
The Department says it does not administer municipal licenses. City and county officials decide which local licenses and permits you need. Check with every city office where you do business before you start. One business may need several licenses, which the FAQ warns about.
What does the LLC itself cost?
Separate from the license, the entity has its own costs. Our Alabama LLC guide covers the filing.
- Certificate of Formation. The Secretary of State fee is $200.
- No Secretary of State annual report. Alabama LLCs file a business privilege tax return with the Department of Revenue instead.
- Business privilege tax. The minimum is $50.
- Return due. For LLCs, no later than two and a half months after the start of the tax year.
That tax return is not the privilege license. They are paid to different offices on different dates.
What do you register after forming?
Get an EIN from the IRS using how to get an EIN. Then contact the probate office in your county for the privilege license, and your city for any local license. Tax account numbers for other taxes are covered in state tax ID lookup.
If you will trade under a brand name, read the Alabama DBA guide too.
In what order should you do it?
- Form the LLC with the Secretary of State.
- Get the EIN.
- Go to the probate office in each county where you operate for the privilege license.
- Ask each city where you work about its own license.
- Mark October on your calendar for the yearly renewal.
- Mark the business privilege tax return date too.
The October renewal and the tax return are separate duties, so do not assume one covers the other. If you let the license lapse, it is delinquent from November 1.
Where do you check a license?
We did not read a statewide license verification tool for Alabama. The county probate office issues the license, so it is the place to ask for a copy or to confirm one. See business license lookup for general tips.
What this page does not cover
Municipal fees, professional board licenses and tax rates are not covered. The Department of Revenue pages we read are archived copies, so confirm the dates and rules on its site before you rely on them. This is not legal or tax advice.