SB79 Alabama 2018 Session

Summary

Primary Sponsor

Gerald O. Dial

Republican

Session

Regular Session 2018

Title

Income tax credits, increase for rural physicians and dentists, Secs. 40-18-130 to 40-18-132, inclusive, am'd.

Summary

SB 79 expands Alabama's rural tax credit by extending it for physicians, adds dentists to the program, and sets a transition period before the duration returns to five years.

What This Bill Does

It increases the credit duration from 5 to 10 consecutive years for newly qualifying rural physicians and rural dentists, starting in 2019, but starting in 2023 the total duration is reduced back to five years. It extends the program to dentists who reside and practice in small rural communities (at least 20 hours per week). It requires certification from the Alabama Department of Public Health before claiming the credit and directs the Department of Revenue to issue implementing rules and regulations. The bill also defines who qualifies as a rural physician or dentist and what counts as a small rural community or hospital. Additionally, it includes a transition rule for pilots who previously claimed the credit in 2018 and requires annual reporting by ADPH on the credits.

Who It Affects

• Rural physicians who practice in and reside in small rural Alabama communities (must have hospital privileges and average at least 20 hours per week).
• Rural dentists who practice in and reside in small rural Alabama communities (average at least 20 hours per week).
• Alabama Department of Public Health (ADPH) or their designee (certifies eligibility for the credit and issues certificates; must file annual informational reports).
• Alabama Department of Revenue (DOR) (promulgates rules to implement and administer the credit).
• Physicians or dentists who previously practiced in small rural communities and are seeking to qualify under the new rules after December 31, 2018 (subject to return-after-urban criteria and the transition provisions).

Key Provisions

• Credit amount remains $5,000 per year and applies for up to 10 consecutive tax years for newly qualifying rural physicians and rural dentists.
• Transition rule: a physician who received the credit in 2018 and later qualifies under the new rules will have a 10-year credit period, reduced by the number of years already claimed under the old credit.
• Starting with tax year 2023, the total duration of the credit for those who qualify or newly qualify is reduced back to five consecutive tax years.
• Dentists may qualify if they reside and practice in a small rural community, with at least 20 hours of practice per week.
• Definitions are added for terms like rural physician, rural dentist, small or rural community, and small or rural hospital (including criteria such as hospital privileges and location sizes).
• Before claiming the credit, the individual must obtain a certificate from the Alabama Department of Public Health (or designee) confirming eligibility and attach it to the tax return.
• The ADPH (or designee) must file an annual informational report about physicians and dentists receiving the credit.
• The Department of Revenue will issue rules and regulations necessary to implement and administer the credit.
• The act becomes effective immediately after passage and approval by the Governor.

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