SB301 Alabama 2012 Session

Summary

Primary Sponsor

Gerald H. AllenSenator

Republican

Co-Sponsor

Scott Beason

Session

Regular Session 2012

Title

Income tax, credit provided for qualifying educational expenses of students enrolled in nonpublic private and church schools

Summary

SB301 would create a state income tax credit for qualifying educational expenses paid by parents or guardians of students attending qualified nonpublic or church schools, with income limits and a phased-in eligibility timeline.

What This Bill Does

It would provide a nonrefundable Alabama income tax credit for up to 75% of qualifying educational expenses for eligible students in qualified schools, with up to 100% for low-income households. The credit is limited to households with an adjusted gross income of $60,800 or less, and there are per-child and per-household maximums ($500 per child in 2012, $600 per child in 2013; $650 per household in 2012, $750 per household in 2013; later indexed for inflation). Any unused credit can be carried forward for two additional years, and claiming the credit cannot be done in addition to itemizing deductions for the same year. The act also sets definitions, rules for receipts, and requires a standard school receipt and administrative guidelines to implement the program, with an effective date in mid-2012.

Who It Affects

• Parents or guardians of eligible students enrolled in qualified nonpublic private or church schools, who may claim a tax credit for qualifying educational expenses if their household income is at or below $60,800.
• Qualified nonpublic private or church schools that meet the accreditation or minimum operation standards and must issue standardized receipts documenting qualifying educational expenses for credit purposes.

Key Provisions

• Eligible students progress from grades 9-12 in 2012 to include grade 8 in 2013 and, in subsequent years, lower grades until all grades 1-12 are eligible.
• Qualified schools must be private or church schools that meet accreditation requirements or minimum standards (existence for at least 3 years, attendance rate, school year length, school day length, testing requirements, graduation credits, teacher-student ratio, and other criteria).
• Qualifying educational expenses are tuition payments to a nonpublic school necessary for required academic instruction.
• Tax credit equals up to 75% of qualifying expenses per eligible student; up to 100% for low-income households defined as 175% of the federal poverty level (e.g., $39,135 for a family of four at the time).
• Annual income limit to claim credit is $60,800 AGI for the household; higher-income households cannot claim the credit.
• Credit amounts per child: $500 in 2012 and $600 in 2013 (with per-household caps of $650 and $750 respectively); subsequent years adjust for inflation.
• Unused credit can be carried forward for two years; credits cannot be claimed if the amount is also taken as a deduction.
• The Department of Revenue may require receipts and will create forms, receipts, and rules to administer the credit, including a standardized school receipt.
• The act becomes effective on the first day of the third month after passage, and the Department of Revenue must annually report total credits claimed.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation