Are there any penalties for late payment or filing of state taxes?

Yes, there are penalties for late payment or filing of state taxes in Alabama. If you fail to file your tax return by the due date, a penalty of 1% per month (or fraction thereof) is imposed on the unpaid balance, up to a maximum of 25% of the tax due. Additionally, there is an automatic penalty of 0.5% per month for late payment, also capped at 25%. If you fail to pay the taxes owed altogether, you may face additional penalties, such as a 5% penalty for each month the tax remains unpaid, up to a maximum of 25%. It's important to note that interest is also charged on any unpaid balance. Therefore, it is crucial to timely file and pay your state taxes to avoid these penalties and minimize your financial obligations to the Alabama Department of Revenue.