HB519 Alabama 2022 Session

Summary

Primary Sponsor

Ed OliverRepresentative

Republican

Session

Regular Session 2022

Title

Rural physicians, income tax credit for practice of medicine in a rural area, conditions and limitations, Secs.40-18-130, 40-18-131, 40-18-132 terminated after tax year 2022, new credit effective January 2023, Bd. of Medical Examiners to certify eligible doctors, Secs. 40-18-133, 40-18-133.1, 40-18-133.2 added; Secs. 40-18-130, 40-18-131, 40-18-132 repealed

Summary

It terminates the old rural physician tax credit after 2022, establishes a new 5-year, $5,000-per-year credit for eligible rural physicians starting in 2023, and adds certification and reporting requirements.

What This Bill Does

The bill ends the existing rural physician income tax credit for tax years after 2022, but allows those who claimed it for 2022 to continue under the old rules for the remainder of their five-year period. It creates a new Division 2 rural physician credit of $5,000 per year for up to five years for physicians who live and practice in a rural community, beginning with the 2023 tax year. It requires certification by the State Board of Medical Examiners to qualify, requires certificates to be attached to tax returns, and requires annual reporting by the Board and the Department of Revenue; it also defines eligibility criteria and imposes certain restrictions on who can qualify.

Who It Affects

• Rural physicians who live in and practice in rural communities and meet the new criteria; they could receive up to $5,000 per year for up to five years starting in 2023, provided they obtain the required certification.
• Physicians who previously claimed the old rural physician credit for 2022; they may continue to receive the old credit for the remainder of their five-year period under the prior law, but they cannot switch to the new Division 2 credit.
• State Board of Medical Examiners and the Department of Revenue; they will certify eligibility, issue and track certificates, and produce annual reports on the program.

Key Provisions

• Termination of the existing rural physician tax credit for tax years after December 31, 2022, with grandfathering allowing 2022 claimants to continue under the old credit for the remainder of their five-year period.
• Creation of Division 2 rural physician income tax credit, effective for tax years beginning in 2023, amounting to $5,000 per year for up to five years for eligible rural physicians.
• Definitions: rural community is a rural area designated under federal criteria; rural physician is a physician who lives and practices in a rural community.
• Eligibility restrictions: no Division 2 credit for any physician who previously claimed the Division 1 credit; no credit under Division 2 for those who practiced in a rural community before 2023 unless they return to rural practice after 2023 following at least three years in urban or outside Alabama.
• Certification requirement: physicians must obtain a certificate from the State Board of Medical Examiners (or its designee) demonstrating eligibility, with the certificate attached to the tax return; without it, the credit is automatically denied.
• Reporting requirements: the Board must provide annual informational reports listing issued certificates to the Department of Revenue; the Department must file annual informational reports for recipients of the credit and adopt rules to implement the division.

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