HB206 Alabama 2013 Session

Summary

Primary Sponsor

Barbara Bigsby BoydRepresentative

Democrat

Session

Regular Session 2013

Title

Oil and gas, taxation, depletion allowance altered, limited to federal depletion allowance, Sec. 40-18-35 am'd.

Summary

HB206 would cap Alabama's oil and gas depletion deduction at the federal depletion allowance amount.

What This Bill Does

The bill amends Section 40-18-35 to limit the state depletion deduction for oil and gas to the federal depletion allowance. Practically, taxpayers computing Alabama taxable income could deduct depletion only up to the federal limit; any additional state-depletion amount would not be allowed. This change could reduce some taxpayers' Alabama deductions and potentially affect state revenue.

Who It Affects

• Oil and gas producers and other taxpayers who claim depletion deductions for oil and gas on their Alabama tax returns (their deductions could be reduced to the federal limit).
• Alabama's Department of Revenue and the state tax system (they would administer and apply the cap, which could affect state revenue).

Key Provisions

• Amends Section 40-18-35 to limit the Alabama depletion allowance for oil and gas to the federal depletion allowance.
• The depletion deduction for oil and gas may not exceed the federal depletion allowance amount.
• If the current state deduction is greater than the federal amount, the excess would be disallowed for Alabama tax purposes.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Oil and Gas