Alabama is situated geographically in the south east of the United States. This region is the fastest growing in the country, with most states ranking high in terms of state GDP. Alabama’s location provides easy access to a number of markets in south east US, as well as South America. In particular the car manufacturing industry is big business. Mercedes-Benz first set up in the state in 1993, with Honda and Hyundai following suit soon after, making Alabama an international car manufacturing business hub.

The tax structure and incentives for new and developing industries make business operating costs significantly less in Alabama. There is also a labour pool of more than 2 million skilled workers, making it a great place to consider for international business, especially for foreign investors looking for an American presence.

It is relatively simple to start a business in Alabama. The timescale is generally a few months, but a payment of $100 will expedite the process to completion within just 10-14 days. Submission of all documentation through the mail will take much longer, up to 6 months. The Secretary of State handles all company set up applications and it is advisable to hire a reputable and experienced local firm to help smooth the way.

The requirements of setting up a business in Alabama are as follows:

  • Firstly, articles of incorporation must be filed with the AL Secretary of State
  • A federal tax ID number (FEIN OR EIN) must be obtained from the IRS
  • A business banking account should be opened under your new Alabama business name
  • Registration with the Alabama Department of Revenue or Alabama Department of Employment and Labour must be done for LLCs employing staff
  • A state trade license may need to be obtained from the Alabama Department of Business and Professional Regulation
  • A general license/local trade license may be required in some cities or states
  • Approval from the city zoning may be required for an office of shop premises

LLCs in Alabama are required to file articles of incorporation with the Secretary of State. The fee for this is $100. Further requirements include:

  • The business name to end in ‘LLC’
  • Company name must be different from any other company name in Alabama.
  • A physical address is needed for your LLC – a PO Box could serve as a mailing address.
  • The name and address of each manager and registered agent must be provided
  • The articles of organisation must be signed by a member


Setting up a corporation involves some different requirements. In addition to the $100 filing fee for articles of incorporation, a minimum of $25 is required as a fee for Franchise Tax. The corporation name must end in INC, Incorporated, Corporation or an abbreviation of these, and be different from any other registered Alabama corporation. You must supply a principal address for the corporation, and you may need to state a specific purpose if you are forming a professional corporation.