Alabama — Credit Card Fee Exclusion & Cash Rounding Rules

• SB 221 excludes credit/debit card transaction fees assessed on purchases of goods or services from the sales and use tax base, effective September 1, 2026 (Act 587, signed April 16, 2026).
• HB 545 authorizes rounding of in-person cash transactions to the nearest five cents (e.g., a final digit of 1–2 rounds down to zero; 3–4 rounds up to five), with no rounding when the digit is zero or five.
• Rounding does not alter the sales price or tax collected and does not apply to non-cash payments (cards, checks, EFT); HB 545 took effect immediately (Act 548, signed April 16, 2026).

Source: EY Sales and Use Tax Quarterly Update – July 2026 (Ernst & Young LLP)

---

---