Live in Florida, Work in Alabama: Which State Taxes Your Paycheck?
Answer
The work state takes it. Alabama taxes nonresidents on income earned within the state and expects a nonresident return; Florida has no wage income tax, so nothing is due there. This is the common pattern for people who live in a no-tax state and commute across the line.
Last verified
This is the mirror image of the more common commute. There is no home-state return to file, so the Alabama nonresident return carries the whole obligation — and because Florida charges nothing, there is no credit mechanism involved anywhere.
Alabama also has a layer below the state one, and it is the layer that survives every agreement: Several Alabama municipalities levy an occupational licence fee on wages earned inside the city — Birmingham is the largest. It is collected by the city, not the Department of Revenue, and no state agreement or credit covers it.
What you file
- 1Nonresident return · AlabamaForm 40NR
File a Alabama nonresident return for the wages you earned in Alabama. Florida has no wage income tax, so there is no second return and no credit to claim.
The two states, side by side
| Florida | Alabama | |
|---|---|---|
| Taxes wages | No | Yes — graduated |
| Reciprocity partners | None | None |
| Convenience rule | No | No |
| Nonresident return | Not applicable | Form 40NR |
| Credit for other-state tax | No income tax | Schedule CR |
| Nonresident safe harbour | Not applicable | None published |
| Local income tax | No | Yes |
| Revenue department | Florida Department of Revenue | Alabama Department of Revenue |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Alabama and working in Florida gives:Home state only.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- Remote worker: Florida → AlabamaNo state income tax on your wages
- 1099 contractor: Florida → AlabamaClient state only, if you work there
- Moved mid-year: Florida → AlabamaOne part-year return — the state you moved to
Other Florida pairs
Questions people actually ask
I live in Florida and work in Alabama. Which state takes the tax out of my paycheck?
The work state takes it. Alabama taxes nonresidents on income earned within the state and expects a nonresident return; Florida has no wage income tax, so nothing is due there. This is the common pattern for people who live in a no-tax state and commute across the line.
Which state should my employer be withholding for?
Alabama. The wages are sourced to Alabama, so Alabama withholding is correct and there is no Florida withholding to set up, because Florida levies no income tax on wages.
How current is this?
The Florida and Alabama rules on this page were last checked against Florida Department of Revenue and Alabama Department of Revenue on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Florida Department of Revenue — individual income taxaccessed 2026-08-07
- Alabama Department of Revenue — individual income taxaccessed 2026-08-07