HB599 Alabama 2013 Session

Summary

Primary Sponsor

Phil Williams

Republican

Co-Sponsors

Mike HubbardBarry MaskHoward SanderfordMac McCutcheonJim PattersonLaura HallMike BallWayne Johnson

Session

Regular Session 2013

Title

Taxation, carried forward period of five years for certain projects, Sec. 40-18-194 am'd.

Summary

HB599 would extend Alabama's capital credit carry-forward to five years for certain projects and expand how credits are allocated and claimed across different business entities.

What This Bill Does

If enacted, the bill allows a five-year carry-forward for qualifying projects with at least $50 million in capital costs and at least 50 new jobs. It also makes the credit available to investors through pass-through entities (owners, shareholders, partners, members, or beneficiaries) and to certain financial institutions, with credits applied against their respective taxes and subject to caps. The bill establishes a tiered carry-forward framework based on total project capital costs and provides an option to use the credit as a nonrefundable estimated tax payment, while delaying initial utilization up to three years and then applying a 20-year credit period. It takes effect on the first day of the third month after passage.

Who It Affects

• Investing companies and their owners, partners, members, shareholders, or beneficiaries, who would receive capital credits and apply them against their personal or corporate tax liabilities under a pass-through framework.
• Financial institutions investing in qualifying projects, who could receive a capital credit against the financial institution excise tax for eligible projects (such as data processing centers or headquarters facilities) and must meet ownership requirements.

Key Provisions

• Extends the carry-forward period to five years for projects meeting a threshold of at least $50 million in capital costs and 50 new jobs; provides a tiered carry-forward limit for larger projects (e.g., up to 4 years for very large costs, with shorter periods for smaller projects).
• Credits are allocated on a pass-through basis to owners, shareholders, partners, members, beneficiaries, and the bill specifies how these credits flow to various entity types (proprietorships, Alabama C corporations, S corporations, trusts, estates, and their beneficiaries).
• Adds a special credit mechanism for financial institutions investing in qualifying projects, allowing a credit against the financial institution excise tax for certain project types (data processing centers, headquarters facilities, or specified energy-related projects) with ownership and compliance conditions.
• Credit amounts cannot exceed the amount otherwise due to the state after applying deductions and credits, with caps (e.g., up to 60% of the tax due, or 80% for certain other energy projects).
• Imposes a tiered carry-forward schedule by capital cost, ranging from 1 to 4 years (and up to 5 years under the threshold in the bill) depending on total project costs, with $100M+ projects generally receiving 1 year and larger amounts potentially longer under the new framework.
• Allows eligible investors to elect annually to treat their allowable credit as a nonrefundable estimated tax payment, computed as if it were a credit but applied as an estimated payment and not as an actual credit, without altering the 20-year credit period.
• Delays initial utilization of the credit for up to three years after the qualifying project is placed in service, after which the 20-year credit period begins.
• Effective date is the first day of the third month after passage and 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