HB577 Alabama 2015 Session

Summary

Primary Sponsor

Phil Williams

Republican

Session

Regular Session 2015

Title

Tax credits, for businesses and individuals who donate to schools for certain equipment

Summary

HB577 would create a Digital Learning Tax Credit that rewards donations to nonprofits funding school digital learning with up to 50% of the donation as a tax credit against tax liability.

What This Bill Does

It would establish a Digital Learning Tax Credit Program allowing businesses and individuals to claim a credit equal to 50% of their donation to eligible nonprofits that grant funds to schools for digital learning. The Department of Revenue would certify eligible nonprofits, approve nonprofit formation for digital learning grants, and set program rules. Donations could be used for devices, infrastructure, wireless connectivity, or improving instructional practices with technology, and grant requests must include a 50% cash or negotiable-instrument match. Nonprofit grant recipients must spend at least 98% of funds on sub-grants, allocate at least 50% of funds to rural districts, and report regularly; the program has a funding cap, carry-forward rules, and annual reporting requirements.

Who It Affects

• Businesses and individuals who donate to eligible digital learning nonprofit organizations would be eligible for a tax credit equal to 50% of their donation, up to 50% of their tax liability.
• Eligible nonprofit organizations that receive digital learning tax credit funds and the school districts they support must meet eligibility requirements, spend 98% of funds on sub-grants, allocate at least 50% to rural districts, and report on fund use and outcomes.

Key Provisions

• Tax credit equals 50% of the donation, up to 50% of the donor's tax liability for donations to eligible nonprofits funding digital learning grants.
• The Department of Revenue must certify eligible nonprofits and approve their formation to provide digital learning grants.
• Grants may be used to purchase technology devices, improve infrastructure, strengthen wireless connectivity, or improve instructional practices with technology.
• Grant funding requests must include a 50% match from the requesting organization in cash or other negotiable instrument.
• Nonprofit recipients must expend at least 98% of funds on sub-grants and have an established record of administering funds across the state.
• The Department of Revenue may adopt rules to implement the act.
• A Digital Learning Tax Credit Account is created in the Education Trust Fund; credits are funded from this account and distributed to eligible nonprofits.
• Initial program cap is $50 million; unused credits may be carried forward for up to three years; if 90% of credits are claimed, the cap increases by 25%.
• Donors may claim credits on a first-come basis; nonprofits must provide status updates to donors; school districts must report annually on fund usage and impact; a collective report is due to state leaders by October 1 each year.
• Credits would become effective for the tax year starting in 2015, with some sections referencing 2016 as when credits begin.

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

Subjects

Tax Credits