SB197 Alabama 2020 Session

Summary

Primary Sponsor

Tom Whatley

Republican

Session

Regular Session 2020

Title

Taxation, tax credit, authorized for the cost of acquisition and construction of a qualified storm shelter

Summary

SB197 creates a nonrefundable Alabama income tax credit to help pay for qualified storm shelters at a taxpayer’s primary residence or on property owned by another person, with a yearly cap and a certification process.

What This Bill Does

It establishes an income tax credit for costs to construct, acquire, or install a qualified storm shelter. For shelters at the taxpayer's own primary residence, the credit is $3,000 or 50% of the cost, whichever is less; for shelters on property owned by another person, the credit is $4,500 or 75% of the cost, whichever is less. The credit is taken in the first year the shelter is placed in service and cannot reduce tax liability below zero. Before claiming the credit, applicants must obtain certification from the Alabama Emergency Management Agency, and there is an annual cap of $2,000,000 for total credits. The agency must report on credits issued, and rules to implement the program may be adopted by the agency, with coverage lasting from 2021 through 2024 unless extended by law.

Who It Affects

• Homeowners or owners of primary residences (including manufactured homes and single-family residences) who incur costs to construct, acquire, or install a qualified storm shelter on or attached to their primary residence.
• Individuals who incur costs to construct, acquire, or install a qualified storm shelter on property owned by another person, for whom a higher credit (up to $4,500 or 75% of cost) may apply.

Key Provisions

• Qualified Storm Shelter must meet EF5-tornado resistance, be attached to the taxpayer's primary residence or on the same lot, meet or exceed FEMA minimum criteria, and be built on-site or manufactured offsite and installed on-site.
• Definitions of Manufactured Home and Primary Residence establish eligibility context for the shelter and credit.
• Credit amounts: $3,000 or 50% of cost for shelters on the taxpayer's own primary residence; $4,500 or 75% of cost for shelters on property owned by another person.
• Credit claimed in the earliest tax year the shelter is placed in service; nonrefundable and nontransferable (cannot reduce tax below zero).
• Certification required: taxpayers must apply to the Alabama Emergency Management Agency for certification of the shelter and total qualifying cost before claiming the credit.
• Annual aggregate credit cap of $2,000,000; once cap is reached, no additional credits are granted for that tax year.
• AEMA reports on the number of shelters and credits; data may be shared with the Legislature under specified rules.
• AEMA may adopt rules to implement the act.
• Effective date: credits available for tax years 2021 through 2024 unless extended by legislation.

AI-generated summary using openai/gpt-5-nano on Feb 23, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation