Budget & Taxes (Tax Credits) in Alabama

in committee · Alabama · House Mar 31, 2026

HB 657: Income Taxes; to provide a one-time refundable income tax credit to qualified taxpayers

This bill creates a one-time refundable tax credit for eligible Alabama individual taxpayers filing returns for the 2025 tax year. To qualify, a person must have filed a state income tax return for both 2024 and 2025 and cannot be a nonresident, an estate, or a dependent claimed on another taxpayer's 2024 return. The credit amount is based on the taxpayer's 2024 tax liability or a fixed dollar amount determined by their 2025 filing status, such as $250 for single filers or $500 for married couples filing jointly. The refund will be automatically issued by the state tax department, applied to any outstanding debts owed to the state, and will not include interest or be treated as taxable income.

Topics ✓ Budget & Taxes

Sub-Topics Income Tax Tax Credits

in committee · Alabama · House Mar 31, 2026

HB 660: Beginning Farmer and Succession Continuity Act established; income tax credit, fund, and loan guarantee program created.

HB 660 creates the Beginning Farmer and Succession Continuity Act to help new farmers in Alabama acquire land by offering financial incentives and support. The bill provides a refundable income tax credit of up to $200,000 to landowners who sell or lease farmland to qualified beginning farmers, provided the land remains in agricultural use for five years. It also establishes a state-backed loan guarantee program covering up to 75% of eligible loans and sets up an online registry to connect retiring farmers with newcomers. Additionally, the act creates a dedicated assistance fund, requires annual reporting on program outcomes, and includes audit provisions to ensure compliance with eligibility rules.

Topics ✓ Budget & Taxes

Sub-Topics Audits & Accountability Tax Credits Tax Incentives Tags Agriculture Economic Development

in committee · Alabama · House Mar 3, 2026

HB 554: State Energy Supply and Chemical Trade Stabilization Act established; income tax credit, grant program, and loan program created.

This bill establishes the State Energy Supply and Chemical Trade Stabilization Act to support Alabama's energy and chemical manufacturing sectors by addressing risks from global trade disruptions. It creates three main financial tools: a grant program with up to $2 million annually for facilities to mitigate trade-related losses and upgrade infrastructure, a refundable income tax credit covering 30% of qualifying investments capped at $2 million per year, and a low-interest loan program for site development and equipment. The legislation also forms a five-member board to assess trade vulnerabilities and recommend strategies for securing supply chains, with the department responsible for implementing rules and the act taking effect on July 1, 2026.

Topics ✓ Budget & Taxes ✓ Energy

Sub-Topics Income Tax Tax Credits Tags Economic Development

in committee · Alabama · House Mar 3, 2026

HB 548: Creates the Automotive Supply Chain Resilience and Expansion Act; creates Automotive Tariff Relief Grant Program; creates the Supply Chain Relocation and Expansion Tax Credit; creates the Export Market Diversification Program

This bill establishes the Automotive Supply Chain Resilience and Expansion Act to support Alabama's automotive industry against federal tariff disruptions. It creates several financial programs including a $10 million grant fund for companies facing tariff-related hardships, a tax credit and loan program for relocating or expanding supply chains, and an export assistance program to help businesses find new international markets. The legislation also allows state procurement agencies to adjust bidding rules to account for tariff costs and establishes a task force to monitor trade impacts and recommend policy responses. These measures are designed to help automotive manufacturers and suppliers maintain operations, retain jobs, and reduce reliance on tariff-affected imports.

Topics ✓ Budget & Taxes

Sub-Topics Procurement Tax Credits

in committee · Alabama · House Mar 5, 2026

HB 585: Money transmissions, transaction fee imposed for certain outgoing international wire transfers, income tax credit established to offset transaction fees imposed on taxpayer, reporting of certain suspicious cash transactions required, Securities Commission to enforce

This bill requires money transmission businesses in Alabama to report large or suspicious cash transactions to the state Securities Commission and imposes a 1.5% fee on outgoing international wire transfers. The collected fees would be placed in a state fund and distributed to local sheriffs to help cover immigration law enforcement costs, while taxpayers who pay these fees would receive an income tax credit to offset the charges. The legislation also establishes criminal and civil penalties for businesses that fail to comply with reporting requirements and creates a study commission to monitor how the fee proceeds are used. These provisions would remain in effect until December 31, 2030, when they are scheduled to be repealed.

Topics ✓ Budget & Taxes ✓ Criminal Justice ✗ Immigration

Sub-Topics Income Tax Tax Credits Law Enforcement

in committee · Alabama · House Mar 3, 2026

HB 551: Creates the Steel and Advanced Manufacturing Competitiveness Act; creates Steel Industry Relief and Investment Grant Program; creates the Manufacturing Innovation and Modernization Tax Credit

This bill establishes the Steel and Advanced Manufacturing Competitiveness Act in Alabama to support local steel producers and industrial manufacturers facing challenges from global trade disruptions. It creates a $10 million annual grant program for eligible manufacturers to address trade-related hardships, fund working capital, retain skilled workers, or improve operational efficiency. The legislation also introduces a refundable income tax credit offering up to 20% of qualifying investments in advanced machinery or automation, capped at $1 million per company and $10 million statewide annually, effective for tax years 2027 through 2029. Additionally, the bill requires state infrastructure projects to prioritize domestically produced steel and components when available, establishes an export expansion initiative to help manufacturers access international markets, and creates a five-member board to monitor trade risks and recommend policy improvements.

Topics ✓ Budget & Taxes

Sub-Topics Income Tax Tax Credits

in committee · Alabama · House Mar 10, 2026

HB 594: Creates the Rural Industry Reshoring and Reinvestment Act; creates the Rural Reshoring Tax Credit Program; creates Rural Industrial Site Development Grant Program

This bill establishes the Rural Industry Reshoring and Reinvestment Act to attract manufacturing and supply chain companies to rural areas of Alabama by offering financial incentives. It creates a tax credit program that provides eligible businesses with up to 5% of qualifying payroll for up to 10 years when they create at least 15 full-time jobs with wages at or above the county median, plus an additional 10% bonus for projects that replace imported supply chains. The legislation also sets up a grant program to fund infrastructure improvements like roads, utilities, and broadband at rural industrial sites, with a separate grant for job creation based on the number of new positions. The Department of Commerce will designate specific rural areas as opportunity zones based on population and economic indicators, and these designations will be reviewed every three years.

Topics ✓ Budget & Taxes ✓ Labor & Employment

Sub-Topics Tax Credits Tags Economic Development

in committee · Alabama · House Mar 10, 2026

HB 596: Economic Development; small towns, programs established to fund businesses, reuse of properties, and other grants, administered by Alabama Department of Economic and Community Affairs; tax credit established

This bill establishes the Main Street Revival Act to support economic development in small Alabama towns with populations under 25,000. It creates four grant programs administered by the Alabama Department of Economic and Community Affairs to help businesses start or expand, preserve historic commercial buildings, support temporary retail spaces and business mentorship, and assist local governments with updating zoning and land use regulations. Additionally, the bill creates a 25 percent income tax credit for property owners who renovate eligible vacant or underutilized commercial properties. Funding for these programs depends on future legislative appropriations, and the law takes effect on January 1, 2027.

Topics ✓ Budget & Taxes

Sub-Topics Income Tax Tax Credits Tax Incentives Tags Economic Development Small Business

in committee · Alabama · House Mar 10, 2026

HB 608: Income Tax; to create the R&D Tax Credit Enhancement Act

This bill creates the R&D Tax Credit Enhancement Act to provide income tax credits for organizations in Alabama that invest in research and development, specifically targeting health sciences, biotechnology, and university-based research. The program would offer a 10% tax credit on qualified research expenses, with higher 15% credits for collaborative research involving in-state academic institutions and up to $250,000 in refundable or transferable credits for startups and small businesses with fewer than 50 employees. The Department of Revenue would administer the program, which is capped at $30 million annually, and publish annual reports on the number of credits issued and the sectors receiving support. The bill would apply to tax years beginning on or after January 1, 2027, and would require a streamlined application process for eligible organizations to claim the credits.

Topics ✓ Budget & Taxes ✓ Technology

Sub-Topics Income Tax Tax Credits

in committee · Alabama · Senate Feb 17, 2026

SB 313: Income taxes, state income tax credit for qualified rehabilitation expenses of certified historic properties extended, annual credit amount increased

SB 313 extends Alabama's state income tax credit for rehabilitating certified historic properties through 2032 (instead of ending in 2027) and increases the annual credit limits. It raises the credit amount for urban properties to $25,000 and lowers the threshold for rural properties to $20,000 (based on county population under 175,000). The bill directly affects property owners - individuals or tax-exempt entities - who undertake substantial rehabilitation of historic structures certified by Alabama's Historical Commission. Key provisions include updated definitions for "rural communities" and "substantial rehabilitation," ensuring the credit aligns with federal standards for historic preservation.

Topics ✓ Budget & Taxes

Sub-Topics Income Tax Tax Credits

All budget & taxes bills