SB342 Alabama 2020 Session

Summary

Primary Sponsor

Chris ElliottSenator

Republican

Session

Regular Session 2020

Title

Coronavirus Aid, Relief, and Economic Security Act, any credits, refunds or loan forgivneness received from, excluded from Alabama taxation

Summary

Alabama would exclude federal CARES Act tax credits, advance refunds, and loan forgiveness from state taxes.

What This Bill Does

If passed, the bill would exclude CARES Act tax credits and advance refunds from Alabama individual income tax. For 2020, these credits or refunds would also be excluded from calculating the federal income tax deduction under Section 40-18-15. Loan forgiveness under the CARES Act would be exempt from Alabama income tax and from the financial institution tax, and would not be counted when determining the deductibility of expenses paid with the exempt funds or in calculating the federal deduction. The law becomes effective immediately after approval.

Who It Affects

• Alabama individual income taxpayers who receive CARES Act tax credits or advance refunds, or have loan forgiveness, who would see these amounts excluded from Alabama taxes and affected deduction rules.
• Banks and other financial institutions in Alabama that would treat CARES Act loan forgiveness as tax-exempt and adjust related deduction calculations.

Key Provisions

• Exclude federal CARES Act tax credits and advance refunds from Alabama individual income taxation.
• For 2020, exclude CARES Act credits/refunds from calculations determining the federal income tax deduction under Section 40-18-15.
• Exempt CARES Act loan forgiveness from Alabama income tax and from the financial institution tax to the same extent as the federal exemption.
• Do not allow CARES Act loan forgiveness funds to reduce the deductibility of otherwise deductible expenses or be counted in the federal deduction calculation under Chapter 18 or Chapter 16.
• Effective immediately following passage and governor's approval.

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