HB224 Alabama 2013 Session

Summary

Primary Sponsor

Darrio Melton

Democrat

Session

Regular Session 2013

Title

Corporate income tax, taxable income to include any amounts in excess of federal domestic production activities deduction, Sec. 40-18-34 am'd.

Summary

HB224 would cap Alabama's corporate bonus depreciation deduction at 50% of the adjusted basis of qualified property, instead of the federal 100% allowance.

What This Bill Does

If enacted, Alabama would limit the bonus depreciation deduction for corporate income tax to 50% of the adjusted basis of qualified property. For tax years beginning after December 31, 2012, any depreciation deduction under 26 U.S.C. §168 that exceeds this 50% cap would be added back to Alabama taxable income. The measure would take effect immediately after the bill is signed into law.

Who It Affects

• Alabama corporations subject to the state's corporate income tax would face a smaller deduction for bonus depreciation, increasing their Alabama taxable income and potentially their tax liability.
• Businesses investing in qualified property that would otherwise qualify for 100% federal bonus depreciation would see a reduced tax benefit under Alabama due to the 50% cap.

Key Provisions

• Amends Section 40-18-34 to limit the bonus depreciation deduction to 50% of the adjusted basis of qualified property.
• Adds to federal taxable income the amount of any depreciation deduction under 26 U.S.C. §168 that exceeds 50% of the adjusted basis of qualified property for taxable years beginning after December 31, 2012.
• Effective date: the act becomes effective immediately after passage and governor's approval.

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

Subjects

Taxation