HB455 Alabama 2015 Session

Summary

Primary Sponsor

Richard Lindsey

Democrat

Session

Regular Session 2015

Title

Income tax, taxpayer who is part of unitary business, Revenue Commissioner authorized to require additional information in alternative reporting format, Secs. 40-2A-17, 40-18-1, 40-18-39 am'd.

Summary

HB455 would require unitary business taxpayers in Alabama to file a combined report to determine Alabama taxable income.

What This Bill Does

The bill defines unitary business and requires taxpayers who are part of such a unit to use a combined report to calculate their Alabama taxable income. The combined report must include all unitary members doing business in the United States or domiciled in OECD-designated tax havens, and income would be apportioned to Alabama using a formula that compares Alabama data to the group's total data. The Alabama Department of Revenue would issue regulations to implement these calculations and enforcement, including rules around non-arm's-length transactions and potential penalties for improper contingent fees related to tax planning or return preparation. The changes would take effect for tax years beginning after December 31, 2014.

Who It Affects

• Unitary business taxpayers with multiple affiliated entities that operate in Alabama; they must prepare and file a combined report to determine Alabama taxable income and allocate it to Alabama.
• Alabama Department of Revenue and tax professionals/adviseors; they face new regulatory framework, enforcement provisions, and penalties related to combined reporting, non-arm's-length transactions, and improper contingent fees.

Key Provisions

• Defines unitary business and requires taxpayers that are part of a unitary group to use a combined report to determine Alabama taxable income, including all United States members and OECD-designated tax haven members, with income apportioned to Alabama based on the combined group's data.
• Authorizes the Commissioner to promulgate regulations to implement the combined report and enforcement provisions, including potential retroactive denial of consolidation for non-arm's-length distortions, and imposes penalties for improper contingent fees in tax planning or return services.

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