HB289 Alabama 2013 Session

Summary

Primary Sponsor

Alan Boothe

Republican

Co-Sponsors

Mike HillChad FincherApril Weaver

Session

Regular Session 2013

Title

Agriculture, irrigation equipment, income tax credit for installation of, qualified reservoir defined, carry forward and pass through of tax credits, further provided for, shareholders authorized to claim pro rata share of tax credit, Sec. 40-18-342 am'd.

Summary

HB289 would modify Alabama's irrigation tax credit by lowering the water-threshold for reservoir exemptions, adding a 5-year carryforward, and allowing shareholders to share the credit through pass-through entities.

What This Bill Does

The bill lowers the surface-water threshold for reservoir-exemption eligibility from 10,000 to 8,000 cubic feet per second; it allows the 20% tax credit for qualified irrigation equipment and reservoirs to be carried forward for five years; and it lets shareholders of pass-through entities (like LLCs, partnerships, and S corporations) claim their pro rata share of the credit claimed by the entity.

Who It Affects

• Irrigation system buyers and agricultural businesses that install qualified irrigation equipment or construct qualified reservoirs, who may receive a 20% credit (up to $10,000 per tax year and limited by their Alabama tax liability) and can carry unused credits forward for five years.
• Shareholders, partners, members, and beneficiaries of pass-through entities (LLCs, partnerships, S corporations) who can claim their proportional share of the credit on their own tax returns.

Key Provisions

• Keeps the 20% credit for the cost of qualified irrigation equipment and reservoir construction, with a $10,000 annual cap and limited by the taxpayer's Alabama income tax liability.
• Reduces the river/stream flow threshold for reservoir-exemption eligibility from 10,000 to 8,000 cubic feet per second.
• Allows the credit to be carried forward for up to five years after the year the system or reservoir is placed in service.
• Requires pass-through entities to allocate the credit to their owners pro rata (shareholders/partners/members/beneficiaries) for tax purposes.
• Limits credit to one purchase and installation of qualified irrigation equipment or one qualified reservoir per taxpayer.
• Effective date: the act takes effect on the first day of the third month after passage and governor 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

Agriculture