Senate Bill 313 Alabama 2026 Session

Summary

Primary Sponsor

Bobby D. SingletonSenator

Democrat

Session

2026 Regular Session

Title

Income taxes, state income tax credit for qualified rehabilitation expenses of certified historic properties extended, annual credit amount increased

Summary

SB313 extends and expands Alabama's historic rehabilitation tax credit through 2032, increasing caps and tying credit amounts to rural vs urban location while adding transferability and new administration rules.

What This Bill Does

It extends the credit through tax year 2032 (ending the prior sunset) and raises the annual cap from $20 million (2023–2027) to $25 million (2028–2032). For 2023–2027 the credit remains 25% of qualified rehabilitation expenditures; for 2028–2032 it is 30% for rural projects and 25% for urban projects, with 40% of annual credits reserved for rural counties (pop. under 175,000). It also adds detailed eligibility standards, a substantial rehabilitation threshold, prescribed timelines for starting and completing work, and allows credits to be transferred or assigned with an 85% minimum value, overseen by a new Historic Preservation Income Tax Credit Account in the Education Trust Fund.

Who It Affects

• Owners of certified historic structures (including leaseholders and entities that own qualified structures) who must submit rehabilitation plans, meet age/standards requirements, and navigate reservation/certification timelines to receive credits.
• Taxpayers owed Alabama state income tax (including partnerships and other pass-through entities) and potential transferees, who may claim or receive credits against taxes or through transfers, subject to caps and transfer rules.

Key Provisions

• Extends the credit through 2032 and increases annual cap to $25,000,000 (2028–2032) from $20,000,000 (2023–2027).
• For 2028–2032, sets credit at 30% for rural structures and 25% for urban structures, with 40% of annual credits reserved for rural counties (population ≤175,000).
• Defines rural vs urban by county population and updates eligibility rules, including age thresholds (60 years generally, 75 years for applications submitted after June 1, 2023) and what counts as a qualified structure and substantial rehabilitation.
• Substantial rehabilitation requirements (2028–2032) require expenditures to exceed 50% of the owner's original purchase price or $25,000, whichever is greater.
• Adds a structured application/rehabilitation-plan process, with timelines: begin rehabilitation within 18 months of notice, incur 50% of estimated costs within 36 months, and complete within 60 months; requires cost and appraisal documentation for final certification.
• Creates a Historic Preservation Income Tax Credit Account in the Education Trust Fund; establishes transfer rules (85% minimum value, one transfer, transfer fees) and a process for issuing and applying tax credit certificates, with annual reporting to the Legislature.

AI-generated summary using openai/gpt-5-nano on Feb 17, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation & Revenue