HB365 Alabama 2014 Session

Summary

Primary Sponsor

Lynn Greer

Republican

Co-Sponsors

Mark TuggleMicky HammonDan WilliamsBarry MooreKerry RichAlan HarperDavid SessionsSteve McMillanMike HillDimitri PolizosJim Patterson

Session

Regular Session 2014

Title

Emergencies, Facilitating Business Rapid Response to Declared Disasters Act, out-of-state businesses not subject to certain income tax provisions during declared emergency in state

Summary

HB365 creates a temporary framework allowing out-of-state businesses and their employees to come to Alabama to respond to declared disasters without triggering most Alabama income taxes during the disaster period.

What This Bill Does

It defines what counts as a declared disaster and a disaster period, and allows out-of-state businesses to establish temporary presence in Alabama to perform disaster-related work when requested by an Alabama-registered business or government. During the disaster period, those out-of-state entities and their employees are not considered to have residency or tax presence for income tax withholding or most state/local taxes, though certain transaction taxes may still apply to equipment used in the state. The act sets eligibility tests for out-of-state businesses, outlines how taxes are treated during and after disasters, and requires reporting information to state agencies; after the disaster, normal rules resume without retroactive effects.

Who It Affects

• Out-of-state businesses and their employees who come to Alabama to perform disaster-related work; they would not be considered resident or subject to Alabama income tax withholding during the disaster period (except for certain transaction taxes on equipment).
• Alabama-registered businesses (and their affiliates) that request disaster-related services and the state/local governments involved; they gain temporary access to non-resident resources and must provide information about the entering entities when asked.

Key Provisions

• Creates the Facilitating Business Rapid Response to Declared Disasters Act of 2014 and defines key terms (declared disaster, disaster period, disaster-related work, infrastructure, out-of-state business, out-of-state employee, registered in-state business).
• Disaster period is defined as 10 calendar days before the declared disaster and extends 60 calendar days after the end, or longer if authorized by authorities.
• Out-of-state businesses may perform disaster-related work in Alabama if requested by a registered in-state business or government, and must meet eligibility tests (no Alabama payroll withholding in the past 12 months or affiliation with an in-state registered business).
• During disaster periods, out-of-state employees and businesses are not considered to have established residency or tax presence for income tax withholding or most state/local taxes (but transaction taxes described in section (d) may apply).
• Businesses with prior nexus in Alabama are not subject to additional tax obligations beyond those allowed; income, payroll, sales, or property related to disaster work shall not be taxed in the same way during the disaster period. Use and ad valorem taxes on equipment brought into the state during the disaster period are addressed in subsection (d).
• During the disaster period, transaction taxes (fuel taxes, sales/use taxes on materials, hotel taxes, car rental taxes, etc.) may apply to equipment used or consumed in Alabama.
• After the disaster period, normal presence/residency and tax rules resume, and the exemption does not apply retroactively.
• Out-of-state businesses must provide a statement to the Secretary of State and Department of Revenue with details such as name, domicile, address, federal tax ID, date of entry, and contact information; registered in-state businesses may provide affiliate information upon request.
• 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