Out-the-door price in Alabama
How Alabama works
- Registering the car: in Alabama the dealer files your title application as the state's designated agent and issues a 20-day temporary tag. You take the paperwork to your county license office within 20 days to get your plate, and you pay the registration fee and the county's ad valorem tax there. The total includes the title and registration fees. It leaves out ad valorem tax, which depends on your county and the car's value.
- Alabama's sales tax on a car has three parts: the state's 2% automotive rate, your city's rate and your county's rate. The city and county rates for vehicles are often lower than their general rates. Across Alabama the total runs from 2% to 7.5%. It is 4.75% in Birmingham, 4% in Huntsville, 4.75% in Mobile and about 3.58% in Montgomery.
- The local part follows the dealership, not your home. A licensed Alabama dealer collects the state tax plus the tax of the city and county where the sale is made, and you cannot be charged a second city or county tax when you register. The calculator uses the rate for the ZIP you entered, which is right when you buy near home. If the dealer is in another city, its rate applies instead.
- Your trade-in reduces the taxable amount, on new and used cars, with no dollar limit. It has to be a vehicle traded for a vehicle, and the credit cannot be more than the price of the car you buy.
- Manufacturer rebates are taxed. Tax is figured on the price before a rebate you apply to the purchase. A dealer's own discount that lowers the selling price does reduce the tax, but a dealer 'rebate' you use as a down payment is treated like a manufacturer rebate.
- The doc fee has no cap in Alabama. Dealer fees, whatever the dealer calls them, are taxed at the same state plus local rate as the car.
- Accessories the dealer adds before the sale and lists on the invoice are taxed with the car at the automotive rate. Parts and accessories bought after the sale carry the 4% general state rate plus the general local rate. Service contracts, extended warranties, maintenance plans and GAP are not taxed.
- A title fee that is separately stated on the contract is not taxed. If it is not separately stated, it is.
- If you buy from a dealer outside Alabama, you pay the 2% state use tax plus your own city and county use tax at your county license office, with credit for tax you already paid the other state.
- Registration estimates: the plate fee shown is the full $23 for 12 months. You are charged by the month for the time left until your renewal month, so it may be less. A pickup over 8,000 lbs pays more, up to $105. Some counties add local fees.
Rules last verified Oct 11, 2026. Our methodology.
Try it for your ZIP
What an Alabama advertised price has to include
Alabama has no statute or rule we could find that says what a dealer's advertised vehicle price must include, and none that lets a dealer leave the doc fee out. The state's deceptive trade practices act bars false or misleading price statements, and Alabama makes it unlawful to advertise that the dealer will absorb the sales tax. The FTC expects every fee the dealer requires, the doc fee included, to be in the advertised price, so only government charges like sales tax, title and registration can be added on top. That still isn't your out-the-door number; the calculator above adds the rest for your ZIP.
Federal law comes first
The FTC requires a dealer's advertised price to include every fee the dealer charges. Only charges the government requires you to pay, like tax, title and registration, can be left out. Where a state's rules let a dealer leave a fee out, the dealer still has to follow the federal rule, so the fee goes in. The FTC says a state's doc-fee rules can add disclosures, but they don't change the price that has to be advertised. Read the FTC's guidance.
Has to be in the advertised price
- The doc fee, which Alabama does not cap, whatever the dealer calls it (clerical, processing, dealer prep)
- Freight (destination) charges and anything the dealer has added to the car
- Dealer-installed accessories listed on the invoice
- The $2.25 temporary tag and the dealer's $1.50 title agent commission, if the dealer charges them
- Any other fee the dealer requires, by any name
Can still be added on top
- Sales tax: 2% state automotive rate plus your city and county rates for vehicles
- The $15 title fee, the $23 license tax and registration fee and the county's $1.25 issuance fee
- An electric or plug-in hybrid's added annual fee
- Optional products you choose to buy, such as a service contract or GAP coverage
- Sales tax in ads: a seller may advertise a price alone, a price plus tax, or the price and the tax stated separately. It is unlawful to advertise, directly or indirectly, that the seller will absorb or refund the sales tax (Ala. Code 40-23-26(b)).
- General rule: the Deceptive Trade Practices Act bars advertising goods with intent not to sell them as advertised, false or misleading statements about price reductions, and any other unconscionable, false, misleading or deceptive act (Ala. Code 8-19-5(9), (11), (27)).
- The doc fee: no statute we found caps it or requires it to be disclosed in an ad. It is part of the gross proceeds of the sale and is taxed (Ala. Code 40-23-1(a)(6); ADOR/ADAA dealer guide, Feb 2025).
- Rebates: a manufacturer rebate is taxed when applied to the price, so a price shown after the rebate still carries tax on the amount before it.
- What the state is silent on: Alabama's licensing statute for dealers (Ala. Code 40-12-390 to 40-12-401) has no advertising price rule. We found no Attorney General rule or Department of Revenue rule on dealer price ads.
More in our guide: Do dealers have to put fees in the advertised price? What actually changed for 2026
Alabama in detail
Rates by county in Alabama
Counties where the rate differs from the rest of Alabama, or changes from one city to the next. The 67 listed here are the ones where your county actually changes the number.
| County | Combined rate | ZIPs |
|---|---|---|
| Randolph County | 4.5%–7.5% | 5 |
| Sumter County | 4.25%–6.25% | 8 |
| Choctaw County | 4%–7% | 10 |
| Jefferson County | 2.75%–5.75% | 110 |
| Mobile County | 3%–5.5% | 58 |
| Pickens County | 3.667%–5.667% | 6 |
| Crenshaw County | 4.5%–5.5% | 9 |
| Russell County | 3.875%–6.75% | 11 |
| St. Clair County | 3%–5% | 13 |
| Coosa County | 4%–7% | 5 |
| Escambia County | 3%–4% | 7 |
| Hale County | 3%–4% | 6 |
| Lawrence County | 3%–6% | 6 |
| Madison County | 2.75%–6.25% | 42 |
| Marion County | 3.5%–6.5% | 7 |
| Perry County | 4%–4.75% | 3 |
| Tuscaloosa County | 3%–4.25% | 27 |
| Barbour County | 2.5%–4.5% | 6 |
| Bullock County | 3.75%–6.75% | 4 |
| Lamar County | 3.25%–4.75% | 6 |
| Montgomery County | 2.333%–3.583% | 43 |
| Geneva County | 3.01%–4.01% | 9 |
| Bibb County | 3.5%–5.5% | 8 |
| Chambers County | 3.2%–3.5% | 5 |
| Coffee County | 2.5%–3.75% | 6 |
| Covington County | 3.25%–5.75% | 10 |
| Morgan County | 3%–3.5% | 13 |
| Pike County | 3.5%–5% | 6 |
| Winston County | 2.375%–5.375% | 8 |
| Baldwin County | 3.25%–6.25% | 28 |
| Chilton County | 3%–3.5% | 7 |
| Etowah County | 2.25%–3.75% | 11 |
| Houston County | 2.5%–4.5% | 14 |
| Macon County | 2.25%–7.25% | 7 |
| Greene County | 3.125%–4.125% | 6 |
| Lee County | 3%–6% | 14 |
| Autauga County | 2.6%–3.1% | 8 |
| Clay County | 3.1%–3.75% | 6 |
| Tallapoosa County | 2.2%–6.2% | 7 |
| Blount County | 2.5%–4.5% | 8 |
| Calhoun County | 2.75%–3.25% | 18 |
| Cherokee County | 3%–4% | 5 |
| Cleburne County | 2.5%–3.75% | 5 |
| Cullman County | 3%–3.5% | 13 |
| Dale County | 3%–4% | 10 |
| DeKalb County | 2.5%–5.5% | 15 |
| Elmore County | 2.5%–4% | 10 |
| Limestone County | 3%–4.75% | 12 |
| Talladega County | 3%–4.5% | 10 |
| Wilcox County | 3%–4.25% | 12 |
| Franklin County | 2.5%–3.25% | 7 |
| Marshall County | 2.5%–4% | 11 |
| Walker County | 2.75%–6.75% | 19 |
| Jackson County | 2.6%–4.6% | 19 |
| Fayette County | 2.583%–3.833% | 8 |
| Colbert County | 2.5625%–3.1875% | 6 |
| Henry County | 2.5%–3.5% | 6 |
| Lauderdale County | 2.25%–5.25% | 11 |
| Washington County | 2.5%–4.5% | 14 |
| Marengo County | 2.45%–4.45% | 11 |
| Lowndes County | 2.4%–2.9% | 6 |
| Dallas County | 2.375%–3.125% | 10 |
| Shelby County | 2.375%–5.375% | 23 |
| Butler County | 2.3%–3.8% | 5 |
| Clarke County | 2.25%–3.75% | 9 |
| Conecuh County | 2.2%–3.7% | 7 |
| Monroe County | 2%–4.5% | 13 |
Alabama OTD questions, answered
Does a trade-in reduce sales tax in Alabama?
Yes — Alabama taxes the difference: your trade-in's value is subtracted before tax is computed.
Are manufacturer rebates taxed in Alabama?
Effectively yes — tax is computed before the rebate is applied, so you pay tax on the pre-rebate price.
Is the doc fee capped in Alabama?
No — doc fees are uncapped in Alabama; buyers report a typical $722.00. It's negotiable as part of your total OTD.
What does an Alabama dealer's advertised price have to include?
Every fee the dealer requires, including the doc fee (the FTC's position). Alabama has no specific rule on what an ad price includes. Only sales tax, title, registration and other government fees can be added on top.
Is there a cap on the doc fee in Alabama?
No. Alabama sets no cap and no formula. The fee is taxed at the same rate as the car. Ask for the amount in writing before you agree.
Which sales tax rate applies when I buy a car in Alabama?
The state's 2% automotive rate plus the city and county rates where the dealership is, not where you live. Together they run from 2% to 7.5% across the state.
Do I pay sales tax at the dealership in Alabama?
Yes. A licensed dealer collects it and sends it to the state. You pay the registration fee and the county's ad valorem tax at your county license office within 20 days.