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40-18-311
Section 40-18-311 Income tax deduction; contributions to catastrophe savings account. (a) An
individual taxpayer is allowed a deduction against income earned for state income tax purposes
imposed pursuant to Section 40-18-5, for amounts contributed to a catastrophe savings account
in accordance with subsection (c) and all interest income earned by a catastrophe savings
account is exempt from the tax imposed pursuant to Section 40-18-5. (b) A catastrophe savings
account is not subject to attachment, levy, garnishment, or legal process in this state. (c)
The total amount that may be contributed to a catastrophe savings account must not exceed
any of the following: (1) In the case of an individual whose qualified deductible is less
than or equal to one thousand dollars ($1,000), two thousand dollars ($2,000). (2) In the
case of an individual whose qualified deductible is greater than one thousand dollars ($1,000),
the amount equal to the lesser of fifteen thousand dollars ($15,000) or...
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40-18-310
Section 40-18-310 Definitions. As used in this article, the following terms shall have the
following meanings: (1) CATASTROPHE SAVINGS ACCOUNT. A regular savings account or money market
account established by an insurance policyholder who is a state income taxpayer for residential
property in this state to cover an insurance deductible under an insurance policy for the
taxpayer's legal residence property that covers hurricane, rising floodwaters, or other catastrophic
windstorm event damage or by an individual to cover self-insured losses for the taxpayer's
legal residence from a hurricane, rising floodwaters, or other catastrophic windstorm event.
The account must be labeled as a catastrophe savings account in order to qualify as a catastrophe
savings account as defined in this article. A taxpayer may establish only one catastrophe
savings account and shall specify that the purpose of the account is to cover the amount of
insurance deductibles and other uninsured portions of risks of...
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40-18-25.1
Section 40-18-25.1 Estates and trusts - Exemptions. (a) Trusts shall be exempt from the tax
imposed by this chapter if they are exempt from federal income tax under 26 U.S.C. § 501
(relating to exempt organizations), § 401 (relating to pension and profit sharing trusts),
§ 408 and § 408A (relating to individual retirement accounts and individual retirement annuities),
§ 530 (relating to Coverdell education savings accounts), or § 664 (relating to charitable
remainder trusts). The foregoing exemption shall not apply, however, to any entity that is
not exempt from federal income tax by reason of 26 U.S.C. §§ 502 or 503, nor to any income
of an otherwise exempt organization to the extent that such income constitutes "unrelated
business taxable income," as defined in 26 U.S.C. § 512. (b) The taxation of distributions
from a trust described in 26 U.S.C. § 401 that constitutes a "defined contribution plan"
as defined in 26 U.S.C. § 414(i) shall be determined in accordance with 26...
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40-18-312
Section 40-18-312 Distributions from catastrophe savings account; additional tax. (a) A distribution
from a catastrophe savings account must be included in the income of the taxpayer unless the
amount of the distribution is used to cover qualified catastrophe expenses. (b) No amount
is included in income, pursuant to subsection (a), if the qualified catastrophe expenses of
the taxpayer during the taxable year are equal to or greater than the aggregate distributions
during the taxable year. (c) If aggregate distributions exceed the qualified catastrophe expenses
during the taxable year, the amount otherwise included in income must be reduced by the amount
of the distributions for qualified catastrophe expenses. (d)(1) The tax paid pursuant to Section
40-18-5, attributable to a taxable distribution must be increased by two and one-half percent
of the amount which is includable in income. (2) This additional tax does not apply if any
of the following occur: a. The taxpayer no longer owns...
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16-6D-9
Section 16-6D-9 Tax credit claims; administrative accountability; verification of requirements;
rules and procedures. (a)(1) An individual taxpayer who files a state income tax return and
is not claimed as a dependent of another taxpayer, a taxpayer subject to the corporate income
tax levied by Chapter 18 of Title 40, an Alabama S corporation as defined in Section 40-18-160,
or a Subchapter K entity as defined in Section 40-18-1 may claim a credit for a contribution
made to a scholarship granting organization. If the credit is claimed by an Alabama S corporation
or Subchapter K entity, the credit shall pass through to and may be claimed by any taxpayer
eligible to claim a credit under this subdivision who is a shareholder, partner, or member
thereof, based on the taxpayer's pro rata or distributive share, respectively, of the credit.
(2) The tax credit may be claimed by an individual taxpayer or a married couple filing jointly
in an amount equal to 100 percent of the total...
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40-18-15.6
Section 40-18-15.6 Deductions for contributions made to health savings accounts. (a) For the
purposes of this section, health savings account contributions are defined as contributions
made by a taxpayer to his or her health savings account up to the maximum amount allowed pursuant
to 26 USC §223. (b) Alabama residents will be allowed to deduct contributions made on or
after January 1, 2018, by or on behalf of such individual to a health savings account of such
individual to coincide with annual amount allotted by federal law or regulation. Employer
contributions are not includible in an employee's income and are therefore not deductible.
(Act 2016-345, §1.)...
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40-18-19
Section 40-18-19 Exemptions - Generally. (a) The following exemptions from income taxation
shall be allowed to every individual resident taxpayer: (1) Retirement allowances, pensions
and annuities, or optional allowances, approved by the Board of Control of the Teachers' Retirement
System of Alabama, which exempt status is set out in Section 16-25-23. (2) Retirement allowances,
pensions and annuities or optional allowances, approved by the Board of Control of the Employees'
Retirement System of Alabama, which exempt status is set out in Section 36-27-28. (3) The
first eight thousand dollars ($8,000) of any retirement compensation, retirement allowances,
pensions and annuities, or optional allowances, received by any eligible firefighter, as defined
in Sections 36-32-1 and 36-32-2, or his or her designated beneficiary, from any firefighting
agency established in the State of Alabama, but only if such retirement compensation, retirement
allowances, pensions and annuities, or optional...
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40-18-15
Section 40-18-15 Deductions for individuals generally. (a) No deduction shall be allowed for
any losses, expenses, or interest deferred or disallowed pursuant to 26 U.S.C. § 267 or for
any cost required to be capitalized in accordance with 26 U.S.C. § 263A; otherwise, there
shall be allowed as deductions: (1) All ordinary and necessary expenses paid or incurred during
the taxable year in carrying on any trade or business, as determined in accordance with 26
U.S.C. § 162. (2) Interest paid or accrued within the taxable year on indebtedness, limited
to the amount allowable as an interest deduction for federal income tax purposes in the corresponding
tax year or period pursuant to the provisions of 26 U.S.C. §§ 163, 264, and 265. (3) The
following taxes paid or accrued within the taxable year: a. Income taxes, Federal Insurance
Contribution Act taxes, taxes on self-employment income and estate and gift taxes imposed
by authority of the United States or any possession of the United...
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40-27-1
Section 40-27-1 Compact adopted; terms. The following Multistate Tax Compact is hereby approved,
adopted and enacted into law by the State of Alabama: Multistate Tax Compact Article I. Purposes.
The purposes of this compact are to: 1. Facilitate proper determination of state and local
tax liability of multistate taxpayers, including the equitable apportionment of tax bases
and settlement of apportionment disputes. 2. Promote uniformity or compatibility in significant
components of tax systems. 3. Facilitate taxpayer convenience and compliance in the filing
of tax returns and in other phases of tax administration. 4. Avoid duplicative taxation. Article
II. Definitions. As used in this compact: 1. "State" means a state of the United
States, the District of Columbia, the Commonwealth of Puerto Rico, or any territory or possession
of the United States. 2. "Subdivision" means any governmental unit or special district
of a state. 3. "Taxpayer" means any corporation, partnership, firm,...
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16-25-21
Section 16-25-21 Method of financing. Effective October 1, 1997, all the assets of the retirement
system shall be credited according to the purpose for which they are held among three funds,
namely: The Annuity Savings Fund, the Pension Accumulation Fund, and the Expense Fund. The
operation of the former Pension Reserve Fund and the Annuity Reserve Fund shall be discontinued
as of such date, the balance of the former Pension Reserve Fund shall be transferred to the
Pension Accumulation Fund, and the balance of the former Annuity Reserve Fund shall be transferred
to the Pension Accumulation Fund. (1) The Annuity Savings Fund shall be a fund in which shall
be accumulated contributions from the compensation of members to provide for their annuities.
Contributions to and payments from the Annuity Savings Fund shall be made as follows: a. Each
employer shall cause to be deducted from the salary of each member on each and every payroll
of such employer for each and every payroll period five...
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