Alabama Paystub Generator

An employee clocking hours inside the Birmingham city limits has three separate authorities reaching into one paycheck: the IRS, the Alabama Department of Revenue and the City of Birmingham, which takes 1% of gross compensation earned in the city under its Occupational Tax Code. Most document tools stop at the second layer, which is why an Alabama paystub built somewhere else usually comes out one line short. This generator is set up to carry that third line, so a Birmingham or Bessemer employer can hand over a document that matches what the payroll account actually paid out.

Three Tax Layers Land on One Alabama Paystub

Alabama State Withholding Subtracts Your Federal Tax First

Alabama runs a graduated state income tax of 2%, 4% and 5% and it is one of the very few states whose withholding formula subtracts the employee’s federal income tax before applying those rates. That quirk means you cannot reverse engineer Alabama withholding from gross pay alone. The Alabama income tax brackets and standard deduction sit behind every figure the tool prints.

Birmingham, Bessemer and Gadsden Occupational Tax Rates

Sitting on top of that is a municipal occupational license tax, charged on the privilege of working inside city limits.

Birmingham: 1% of Gross Compensation, Remitted by the 20th

Birmingham’s ordinance requires every employer to deduct 1% from each payment of gross receipts and compensation due each employee for work performed in the city and to remit it by the twentieth of the following month.

Bessemer: 1% of Gross Salaries, Wages and Commissions

Bessemer applies a 1% occupational tax to gross salaries, wages and commissions, filed quarterly rather than monthly.

Gadsden: 2%, the Highest Rate in the State

Gadsden sits at 2%, the highest rate in Alabama, shared with Attalla, Glencoe, Rainbow City and Southside in Etowah County. That 2% figure is sourced to the Etowah County IDA and to 1819 News reporting rather than to a reachable city ordinance page, so confirm it with the city revenue office before you rely on it.

If the City Was Not Withheld, the Line Does Not Belong

If the employer withheld that third layer, the pay stub has to show it and if the employer did not, a line claiming it is simply wrong. The Alabama paystub requirements and city occupational taxes hub covers which municipalities levy at all.

What to Enter Before the Tool Builds Your Birmingham Pay Stub

The Standard Employer and Employee Fields

The generator asks for the ordinary fields first: employer legal name and address, employee name and address, pay period start and end, pay date, pay frequency and either an hourly rate with hours or a salaried amount per period.

Three Alabama Inputs Generic Tools Skip

Alabama adds three inputs on top and each one changes a number on the finished document.

Filing Status From Form A-4: 0, S, MS, M or H

Alabama uses letter codes rather than the federal W-4 boxes: the employee’s Form A-4 shows 0, S, MS, M or H. That letter drives the personal exemption (1,500 dollars for S or MS, 3,000 for M or H) and which bracket table applies. Choosing M when the certificate says S understates the tax on every future pay stub.

Dependent Count and the Income Tiered Exemption

Alabama tiers the dependent exemption by income: 1,000 dollars each at 50,000 dollars of gross income or less, 500 between 50,000 and 100,000 and 300 above that.

Work City, Which Is Not Always the Employer’s City

This is the field generic tools omit. Enter the municipality where the work was physically performed, not where the company is headquartered. Birmingham’s tax reaches residents and nonresidents alike, so a worker driving in from Trussville has the 1% deducted on those hours.

Preview the Deduction Stack, Then Download the PDF

The preview then shows the full deduction stack before you pay and the PDF downloads with year-to-date columns intact.

Worked Example: A Standard Biweekly Paycheck

Here is a full biweekly stub for an employee in Birmingham earning $28.00 an hour, with 80 regular hours and no overtime for the period.

Federal withholding depends on the employee's W-4, so treat that line as illustrative. FICA is fixed, and this employee's stub carries no city occupational tax line since not every Alabama city collects one.

A Worked Birmingham Paycheck Stub, Biweekly, With Overtime

The Inputs and the Finished Deduction Stack

An hourly maintenance technician at a Birmingham employer: 24.00 dollars per hour, biweekly, 80 regular hours plus 6 overtime at 36.00. Form A-4 status S, no dependents.

How the 90.07 Dollar Alabama Figure Is Calculated

The Alabama figure follows the state’s January 2026 withholding booklet. Annualize the gross at 26 periods to 55,536 dollars, subtract the annualized federal withholding of 3,900 dollars, then subtract the 2,500 dollar standard deduction that applies to an S filer above 35,500 dollars and the 1,500 dollar personal exemption. That leaves 47,636 dollars. Apply 2% to the first 500 dollars, 4% to the next 2,500 and 5% to the remaining 44,636 and the annual tax is 2,341.80 dollars, or 90.07 per period.

What Changes if the Same Hours Are Worked in Gadsden

Change one input and the third layer moves on its own. Send the same technician to a Gadsden jobsite and the city line becomes 42.72 dollars. Move the work to Huntsville or Mobile, neither of which taxes wages locally and the line disappears while the state figure of 90.07 dollars does not budge. Federal withholding will differ from the 150.00 dollars assumed here based on the employee’s Form W-4 and the Alabama result moves with it. You can run the numbers in the Alabama paycheck calculator before you build the document.

Alabama Overtime Is Taxable Again on a 2026 Wage Statement

This is what most Alabama employers still get wrong on a pay stub.

The Overtime Exemption Timeline, in Order

1 January 2024: Act 2023-421 Exempts Hourly Overtime

Act 2023-421 exempted overtime compensation paid to full time hourly employees from Alabama income tax beginning 1 January 2024.

1 October 2024: Act 2024-437 Revises the Rules

Act 2024-437 amended the exemption, with revised rules applying from 1 October 2024.

30 June 2025: The Department of Revenue Ends It

The Alabama Department of Revenue’s own notice states the exemption terminated on 30 June 2025 and that any amounts paid as overtime compensation after that date are subject to income tax and should be treated as regular taxable wages.

Why the 216.00 Dollars of Overtime Above Is Fully Taxed

So for the 2026 paycheck stub above, the 216.00 dollars of overtime sits inside the state taxable base. It is not broken out, subtracted or flagged.

Where EX OT WAGES Still Appears on a 2025 W-2

The only trace of the old rule lives on 2025 Forms W-2, where employers had to report exempt overtime earned during the window in Box 14 using the indicator EX OT WAGES and had to keep it out of Box 16.

The Exemption Never Touched City Tax or FICA

One detail that got lost in the coverage: the exemption never reached the city occupational tax or FICA. Birmingham’s 1% applied to overtime hours the entire time, because the ordinance measures the fee against gross compensation, not against Alabama taxable income.

Do I Owe Jefferson County Tax on an Alabama Pay Stub?

The 0.45% County Occupational Tax Ended in 2011

Employers around Birmingham regularly ask for a Jefferson County line. There is none to add. The county’s 0.45% occupational tax was declared unconstitutional in December 2010 and struck down by the Alabama Supreme Court in March 2011 and federal payroll operations dropped it from Alabama withholding formulas that year. Jefferson County today collects sales, use, lodgings, rental and business license taxes, not a wage tax.

What Survives Is Municipal, Not County Wide

A worker in unincorporated Jefferson County has no local line at all, while a coworker doing identical work six miles away in Birmingham, Bessemer, Fairfield, Midfield or Leeds does. Macon County is the one outlier levying at county level, at 1%.

Alabama Check Stub Codes and What Each Deduction Means

What Do AL SIT, OASDI and OCC TAX Mean on a Stub?

Payroll systems abbreviate aggressively and the search “check stub deductions abbreviation for state of alabama” exists because the results are not obvious. Here is what the tax lines on an Alabama pay stub mean.

Reading the Occupational Tax Abbreviations Correctly

The occupational tax labels are the ones to treat with care, because there is no statewide code for them.

BHAM OCC, OCC-BIR and Plain OCC TAX Can Mean the Same 1%

Birmingham, Bessemer and Gadsden each administer their own tax and the abbreviation printed on the check stub is whatever the payroll provider assigned. Read the rate and the work city together rather than trusting the letters.

FIT and FWT Come Off Before the State Line Is Figured

The federal line is not just one more deduction on an Alabama check stub. It is subtracted before the state calculation runs, which is why the FIT and AL SIT rows move together from period to period.

Who Builds Alabama Payroll Stubs With This Tool

Small Employers Inside Occupational Tax Cities

Restaurants along Birmingham’s Southside, contractors on Jefferson County jobsites and retail operators in Bessemer need the city line named separately so a worker can reconcile the pay stub against the quarterly return.

Household Employers in the Birmingham Metro

A Mountain Brook family paying a nanny who works at their Birmingham office has a real withholding question and no payroll system.

Self Employed Filers and 1099 Contractors

Alabama’s 5% top rate arrives quickly and a freelancer working repeatedly inside Birmingham may owe the occupational tax directly rather than through withholding.

Rebuilding a Lost Alabama Wage Statement

No Alabama statute requires an employer to reissue a lost wage statement, so rebuilding a period from bank deposits and the state’s rate tables is often the only route left. From there you can start a paystub with the figures you have reconstructed.

Alabama Payroll Errors to Catch Before You Print

Using the Headquarters City Instead of the Work City

This is the most common error and it moves the number in both directions. A Homewood head office does not set the rate for hours worked in Birmingham and it does not create one for hours worked in Huntsville.

Subtracting Overtime From Alabama Taxable Wages

The second recurring error is habit left over from the 2024 rules. Overtime paid in 2026 belongs in the taxable base with every other hour.

Missing Form A-4, Stray Unemployment Tax, Wrong City Assumptions

Skipping Form A-4 leaves no basis for choosing the S or M bracket table. Putting the employer’s unemployment tax on the employee side of a pay stub places it where it never belongs. Assuming a Huntsville or Montgomery employee owes a city wage tax because a Birmingham coworker does adds a line that no ordinance supports. Georgia has no local wage tax to add at all, which is the more usual arrangement in the Southeast.

What This Alabama Paystub Tool Is and Is Not For

Every figure this tool prints comes from what you type. It is a formatting and calculation aid for wages genuinely earned and, where withholding applies, genuinely withheld and remitted. Use it to reissue a lost period, to document household or contractor payments, or to give a small crew a legible record. Do not use it to describe money that did not change hands. In Alabama, where no statute forces an employer to produce a wage statement at all, the accuracy of what you create is the only thing standing behind it.