HB391 Alabama 2022 Session

Summary

Primary Sponsor

Steve ClouseRepresentative

Republican

Session

Regular Session 2022

Title

Business privilege tax, minimum business privilege tax for taxable years beginning after December 31, 2022, reduced a full exemption on amounts due of $100 or less for taxable years beginning after December 31, 2023, Section 40-14A-22 am'd.

Summary

HB391 lowers Alabama's minimum business privilege tax to $50 starting after 2022 and creates a full exemption for small amounts ($100 or less) starting after 2023, with certain exceptions.

What This Bill Does

It reduces the minimum tax for most business taxpayers from $100 to $50 for taxable years beginning after December 31, 2022. For taxable years beginning after December 31, 2023, taxpayers who would otherwise owe the minimum tax will be exempt from the privilege tax and filing requirements if the amount due is $100 or less. The exemption does not apply to taxpayers subject to the tax levy under Section 20-2A-80 (Act 2021-450). The overall tax framework (rates, maximums, etc.) remains, and the Department of Revenue may adopt implementing rules; the act becomes effective on the first day of the third month after it passes.

Who It Affects

• General business taxpayers (corporations, limited liability entities, and disregarded entities) doing business in Alabama: the minimum tax is reduced to $50 for years after 2022, and starting in 2024 such taxpayers with an amount due of $100 or less are fully exempt from the tax and filing requirements (with exceptions for those covered by Section 20-2A-80).
• Financial institution groups and related taxpayers: these groups are governed by the existing financial-institution minimum-tax rules; the changes provide a lower general minimum tax and a small-amount exemption framework that also apply to these taxpayers, except where specifically excluded by the Act 20-2A-80 provisions.

Key Provisions

• Amends Section 40-14A-22 to set the minimum business privilege tax at $50 for taxable years beginning after December 31, 2022.
• For taxable years beginning after December 31, 2023, taxpayers who would otherwise pay the minimum tax of $100 shall be exempt from the privilege tax and the associated filing requirement if the amount due is $100 or less, with an exception for those subject to the tax levy under Section 20-2A-80.
• The exemption for small amounts does not apply to taxpayers subject to the tax levy under Section 20-2A-80 (Act 2021-450).
• The Department of Revenue may adopt rules to implement the act.
• The act becomes effective on the first day of the third month following its passage and approval.

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

Subjects

Business Privilege Tax