SB228 Alabama 2021 Session

Summary

Primary Sponsor

Steve LivingstonSenator

Republican

Session

Regular Session 2021

Title

Rural physicians and dentists, income tax credit under certain conditions, Secs.40-18-130, 40-18-131, 40-18-132 am'd.

Summary

SB228 revamps Alabama's rural health tax credits by ending the old rural physician credit, creating a new $5,000 five-year credit for rural physicians and dentists, and adding certification and reporting requirements.

What This Bill Does

The existing rural physician tax credit ends after 2020, but physicians who claimed it for 2021 can continue under the old framework for the remainder of that five-year period. A new Division 2 program creates a rural dentist and rural physician tax credit starting in 2022, worth $5,000 per year for up to five consecutive years if the recipient practices at least 20 hours per week in a rural community (definitions based on federal law) and no longer requires a rural hospital. Certificates from the appropriate professional boards are required before claiming the credit, and there will be annual reporting on recipients; rules will be adopted by the Department of Revenue; the act takes effect immediately upon passage.

Who It Affects

• Rural physicians who practice at least 20 hours per week in a rural community and may qualify for a $5,000 annual tax credit for up to five years (with certification required).
• Rural dentists who practice at least 20 hours per week in a rural community and may qualify for a $5,000 annual tax credit for up to five years (with certification required).

Key Provisions

• Termination of the existing rural physician income tax credit after December 31, 2020; physicians who claimed the credit for the 2021 tax year may continue to claim under the prior framework for the remainder of the original five-year period.
• Creation of Division 2 to provide a rural dentist and rural physician income tax credit beginning with the 2022 tax year, amounting to $5,000 per year for up to five consecutive years, for those who practice at least 20 hours per week in a rural community; rural community defined by federal law and removal of the hospital requirement.
• Certification requirement: rural physicians and dentists must obtain certificates from the State Board of Medical Examiners or State Board of Dental Examiners (or designees) before claiming the credit, and must attach the certificate to their tax return; annual informational reports by the boards on recipients.
• Eligibility and continuity rules: a recipient must claim five consecutive years to receive the full credit; leaving rural practice and returning after 2022 requires meeting a three-year urban/other practice requirement to requalify; automatic ineligibility if a year is skipped or five-year limit is reached.
• Immediate effectiveness: the act becomes law immediately upon passage.

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