HB356 Alabama 2024 Session

Summary

Primary Sponsor

Jamie KielRepresentative

Republican

Session

Regular Session 2024

Title

Income tax, tax credit for voluntary cash contributions to pregnancy center or residential maternity facility

Summary

HB356 creates a state income tax credit for voluntary cash contributions to eligible pregnancy centers and similar facilities, with rules for eligibility and limits.

What This Bill Does

It allows individuals and businesses to claim a credit against Alabama income tax for cash gifts to eligible pregnancy-related organizations. The credit can be up to 50% of the taxpayer’s state income tax liability and can be carried forward for five years; it is nonrefundable and not transferable. The Department of Revenue certifies eligible organizations, maintains a public list, and allocates credits each year up to a $10 million cap, with a limit that no single organization can receive more than half of the total credits. The act sets criteria for eligible organizations, defines how pass-through entities allocate credits, and becomes effective January 1, 2025 through 2029 unless extended.

Who It Affects

• Individuals who make voluntary cash contributions to eligible pregnancy-related charities and may claim a credit against their Alabama income tax (half credit if a married couple files separately).
• Businesses and other business taxpayers (corporations, LLCs, partnerships, sole proprietorships) that donate; credits can be allocated to owners or partners in proportion to ownership.

Key Provisions

• Eligible charitable organizations must be 501(c)(3) or Alabama nonprofit, operate as a pregnancy center, licensed mobile clinic, or residential maternity facility, and meet specific service criteria (dedicated client phone line, open at least 20 hours/week, provide free services to assist pregnancy to term, promote parenting/adoption, and use licensed medical professionals).
• Tax credits are available against the state's income tax, capped at 50% of the taxpayer's total state income tax liability, with a five-year carryforward for unused credits and no deduction for the contributed amount.
• Annual credits are capped at $10,000,000, with no more than 50% of total credits for any single eligible organization in a calendar year; credits earned by pass-through entities are allocated among owners.
• The Department of Revenue certifies eligible organizations, collects certification information from organizations, reviews eligibility, and publishes a list of eligible organizations; it allocates credits within 30 days of application and enforces contribution timing (contributions tied to credits must be made within 90 days of allocation).
• The act becomes effective January 1, 2025 and lasts through the 2029 tax year unless extended by the Legislature; the department may adopt rules to implement the act.

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 & Revenue