HB227 Alabama 2021 Session

Summary

Primary Sponsor

Joe LovvornRepresentative

Republican

Session

Regular Session 2021

Title

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

Summary

HB227 creates a storm shelter tax credit for primary residences, caps it at $2 million per year, and aligns Alabama tax treatment of ARPA restaurant revitalization grants with federal rules.

What This Bill Does

Establishes a nonrefundable Alabama income tax credit for the construction, acquisition, or installation of a qualified storm shelter at a taxpayer’s primary residence. The credit equals $3,000 or 50% of total eligible costs, whichever is less, and costs reimbursed by insurance or other grants don’t count. It cannot reduce tax liability below zero and is not refundable, transferable, or carryable forward; it must be claimed in the year the shelter is installed when a tax credit certificate is issued. Certificates are issued by the Alabama Emergency Management Agency on a first-come, first-served basis until the $2,000,000 annual cap is reached; if the cap is met, eligible taxpayers are notified and can apply next year. The act also exempts SBA ARPA restaurant revitalization grants from Alabama income tax to the same extent as federal law and treats those funds as not deductible for state purposes. The credit program starts in 2022 and runs through 2025 unless extended.

Who It Affects

• Taxpayers who incur costs to construct, acquire, or install a qualified storm shelter at their primary residence in Alabama (including manufactured homes and single-family homes) and wish to claim the credit.
• Recipients of SBA/ARPA Restaurant Revitalization Grants, whose grant funds will be exempt from Alabama income tax and treated similarly to federal rules for deductions.

Key Provisions

• Creates an Alabama income tax credit for qualified storm shelters at a taxpayer's primary residence; credit amount is $3,000 or 50% of eligible costs, whichever is less; unreimbursed costs only.
• Credit is nonrefundable, nontransferable, and non-carryable forward; must be claimed in the year the shelter is installed when a tax credit certificate is issued.
• Annual aggregate credit cap of $2,000,000; certificates issued by the Alabama Emergency Management Agency on a first-come, first-served basis; if cap is reached, notices issued and applicants may reapply in the next year.
• Taxpayers must file an informational report with the Alabama Emergency Management Agency detailing shelter costs; AEMA issues a tax credit certificate after review; Department of Revenue applies the credit and may audit.
• Effective January 1, 2022 through the 2025 tax year, unless extended by law.
• Section 2: For tax years after enactment, restaurant revitalization grants from ARPA are exempt from Alabama income tax to the same extent as federal law; not considered in calculating state deduction or federal deduction for the grant.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation