40-18-35
Section 40-18-35 Deductions allowed to corporations. (a) The following items shall be
deducted from federal taxable income for purposes of computing taxable income under this chapter:
(1) Refunds of state and local income taxes. (2) Federal income tax paid or accrued during
the taxpayer's taxable year. The portion of federal income tax deductible by a corporation
earning income from sources both inside and outside of Alabama shall be determined by the
ratio that the corporation's taxable income, computed without the deduction for federal income
tax, apportioned and allocated to Alabama bears to the corporation's taxable income, computed
without the deduction for federal income tax, apportioned and allocated everywhere. (3) Interest
income earned on obligations of the United States. (4)a. Interest income earned on obligations
of the State of Alabama or its subdivisions or instrumentalities thereof to the extent included
in gross income for the purposes of federal income taxation. b....
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40-18-169
Section 40-18-169 Adjustments to earnings and profits. (a) Except as provided in subsections
(b) and (c) of this section, no adjustment shall be made to the earnings and profits
of an Alabama S corporation. (b) In the case of any transaction involving redemption, liquidation,
reorganization or division of any Alabama S corporation, proper adjustment to any accumulated
earnings and profits of the corporation shall be made. (c) Subsection (a) of this section
shall not apply with respect to that portion of a distribution which is treated as a dividend
under subdivision (2) of subsection (c) of Section 40-18-165. (d) Any distribution
of money by a corporation with respect to its stock during a post-termination transition period
shall be applied against and reduce the adjusted basis of the stock, to the extent that the
amount of the distribution does not exceed the accumulated adjustments account. An Alabama
S corporation may elect to have the first sentence of this subsection not apply to...
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40-18-422
Section 40-18-422 (Credit expires after 2025 tax year unless extended.) Tax credit for
eligible employers of apprentices. (a) For tax years beginning on or after January 1, 2017,
through the tax year beginning January 1, 2019, an Alabama income tax credit is allowed for
eligible employers that employ an apprentice for at least seven full months of the prior taxable
year. The credit shall equal up to one thousand dollars ($1,000) for each apprentice employed,
not to exceed five apprentices employed. The Department of Revenue, in consultation with the
Workforce Development Division of the Department of Commerce, shall establish a scale reflecting
ranges of amounts of money an employer has invested in an eligible apprentice and a corresponding
tax credit amount and shall award the tax credit in accordance with this scale following confirmation
from the Workforce Development Division that the apprentice for whom the credit is claimed
is in compliance with all federal and state requirements...
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10A-10-1.21
Section 10A-10-1.21 Income tax. (a) A real estate investment trust shall be subject
to the tax imposed by Section 40-18-31, provided, that for purposes of Section
40-18-33, the "net income" of a real estate investment trust shall mean "real
estate investment trust taxable income" as defined in 26 U.S.C. Section 857 as
in effect from time to time. (b) Solely for purposes of conforming federal law with Alabama
law, the "net income" of a real estate investment trust determined pursuant to subsection
(a) shall be further adjusted as follows: (1) The deduction for intercorporate dividends received
under Section 40-18-35(a) (7), shall not be allowed. (2) The deduction for dividends
paid, as defined in 26 U.S.C. Section 561, shall be allowed but (i) shall be computed
without regard to that portion of the deduction which is attributable to the amount equal
to the net income from foreclosure property as defined in 26 U.S.C. Section 857, and
(ii) shall be limited by the provisions of Section...
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40-18-172
Section 40-18-172 "Post-termination transition period" and "determination"
defined. (a) For purposes of this article, the term "post-termination transition period"
means: (1) The period beginning on the day after the last day of the corporation's last taxable
year as an Alabama S corporation and ending on the later of: a. The day which is one year
after the last day. b. The due date for filing the return for the last year as an Alabama
S corporation, including extensions. (2) The 120-day period beginning on the date of a determination
pursuant to an audit of the taxpayer which follows the termination of the corporation's election
to be treated as a federal S corporation and which adjusts a subchapter S item of income,
loss, or deduction of the corporation arising during the S period. (3) The 120-day period
beginning on the date of a determination that the corporation's election under 26 U.S.C. §
1362 had terminated for a previous taxable year. (b) For purposes of subsection (a), the...

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40-18-176
Section 40-18-176 Nonresident shareholder composite returns. (a) The Department of Revenue
shall permit an Alabama S corporation to file composite returns and to make composite payments
on behalf of some or all of its nonresident shareholders if there are one or more nonresident
shareholders during any part of the taxable year. The Department of Revenue may permit composite
returns and payments to be made by an Alabama S corporation on behalf of its resident shareholders.
(b) For purposes of this section, a "composite return" means an informational
return similar in form to U.S. Treasury Department Schedule K-1 containing information concerning
one or more Alabama S corporation shareholder's respective shares of income, deductions and
losses passed through to them by virtue of their status as shareholders of an Alabama S corporation,
any credit to which the shareholder is entitled to claim by virtue of the Alabama S corporation's
payment of tax on his or her behalf pursuant to...
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40-18-26
Section 40-18-26 Information from source of income. Every resident individual, corporation,
association, or agent shall make a report to the Department of Revenue of complete information
covering the amount of all interest, rent, salaries, wages, premiums, annuities, compensations,
remunerations, emoluments, or other fixed or determinable gains, profits and income, except
interest coupons payable to bearer, of any taxpayer taxable under this chapter, of $1,500
or more in any taxable year under such regulations and in such form and manner and to such
extent as may be prescribed by the Department of Revenue. (Acts 1935, No. 194, p. 256; Code
1940, T. 51, §393.)...
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40-18-31
Section 40-18-31 Corporate income tax - Generally. (a) A corporation subject to the
tax imposed by Section 40-18-2 shall pay a tax equal to six and one-half percent of
the taxable income of the corporation, as defined in this chapter. (b) If the taxpayer elects
to file an Alabama consolidated return under Section 40-18-39, the tax shall be assessed,
collected, and paid annually for each taxable year at the rate specified in subsection (a),
upon and with respect to the taxable income of the Alabama affiliated group. (Acts 1935, No.
194, p. 256; Code 1940, T. 51, §398; Acts 1963, 2nd Ex. Sess., No. 104, p. 284, §1; Act
98-502, p. 1083, §1; Act 99-664, 2nd Sp. Sess., p. 124, §1.)...
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40-18-35.1
Section 40-18-35.1 Carry forward of net operating losses. In computing the taxable income
of corporations subject to income tax as outlined in Section 40-18-35, there shall
be allowed, in addition to the deductions specified therein, a deduction for the sum of the
net operating losses which may be carried forward to the taxable year for which the net income
of the corporation is being computed. (1) The term "net operating loss" for the
purposes of this section means the excess of the deductions (other than the deduction
allowed by this subdivision) allowed by this chapter during a taxable year of the corporation
over the corporation's gross income during that taxable year. For purposes of this paragraph,
the corporation's gross income and allowable deductions shall be determined under the provisions
of this chapter applicable to the year in which the net operating loss arises. (2) A net operating
loss shall be carried forward to the earliest subsequent taxable year in which the...
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40-18-13
Section 40-18-13 Computation of income. (a) Income shall be computed on the basis of
the same taxable year and in accordance with the same method of accounting that the taxpayer
properly employs for federal income tax purposes. If no such method of accounting has been
employed or if the method so employed does not clearly reflect income, computation shall be
made upon such basis and in such manner as in the opinion of the Department of Revenue, and
consistent with federal income tax treatment, does clearly reflect income. If the taxpayer
has no annual accounting period or does not keep proper books of account, the income shall
be computed on the basis of the calendar year. (b) In the case of a partnership, Alabama S
corporation, or personal service corporation electing a taxable year under 26 U.S.C. §444,
this section shall be applied without regard to the requirement to make payments under
26 U.S.C. §7519. (Acts 1935, No. 194. p. 256; Code 1940, T. 51, §383; Acts 1990, No. 90-583,...

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