Alabama Department of Revenue
50 N. Ripley St.
Montgomery, AL 36104
Office of the Commissioner
Alabama Department of Revenue
P.O. Box 327001
Montgomery, AL 36132-7001
The Alabama Department of Revenue administers tax incentives for existing industries, expanding industries, and new industries locating in Alabama.
Alabama offers different types of statutory tax abatements to qualifying industries.
Section 41-7A-43 authorizes the Alabama Film Office to award up to $20 million each year in incentives to qualified production companies.
The 2013 Alabama Historic Rehabilitation Tax Credit provides for an income tax credit against the tax liability of the taxpayer for the rehabilitation, preservation, and development of historic structures.
The 2017 Alabama Historic Rehabilitation Tax Credit provides for a refundable income tax credit against the tax liability of the taxpayer for the rehabilitation, preservation, and development of historic structures.
The Income Tax Capital Credit program, repealed by Act 2015-27, sunset on January 2, 2016, for new projects. Projects that filed a Form INT with the Alabama Department of Revenue on or before January 2, 2016, have been grandfathered into the program. An update to the capital credit program statute was passed under Act 2021-240 to provide relief for the companies directly impacted by the Coronavirus (COVID-19) pandemic.
Section 37-11C-4 of the Code of Alabama provides for a refundable tax credit equal to 50 percent of an eligible taxpayer’s qualified railroad rehabilitation expenditures.
Section 40-18-376 provides for a discretionary credit depending upon the qualifications of the approved company’s capital investment and the requirements set forth in §40-18-371.
Act 2021-2 provides a tax credit to eligible taxpayers who make contributions to Economic Development Organizations (EDO) for approved qualifying projects. Taxpayers donating to an EDO for approved projects receive a Growing Alabama Credit equal to their donation.
The Alabama Industry Recognized and Registered Apprenticeship Program offers a tax credit to companies that hire qualified apprentices who receive classroom or industry-specific instruction and on-the-job training.
Act 2023-33 provides a tax credit to qualifying donors who donate to economic development organizations (EDOs) that create, operate, or support certain programs relating to technology accelerators and underrepresented companies.
Section 40-18-220 provides a credit to corporations engaged in coal production within Alabama. The credit amounts to $1 per ton of increased coal production over the previous year’s output. The credit applies to tax years commencing on or after January 1, 1995, based on coal production in Alabama certified by the coal producer.
Act 2024-303 provides a tax incentive to Alabama employers who support their employees’ childcare needs by offering financial assistance for childcare expenses or establishing and/or operating childcare facilities for their employees with children five years old or younger.
Act 2024-303 provides a tax incentive to Alabama childcare providers who own and operate a qualified childcare facility licensed by the Alabama Department of Human Resources and participate in the Quality Rating and Improvement System and Child Care Subsidy Program.
Section 40-18-403 of the Code of Alabama provides for a discretionary income tax credit for businesses that utilize Alabama’s port facilities.
Separately, The Alabama Enterprise Zone Program provides certain tax incentives to corporations, partnerships, and proprietorships that locate or expand within designated Enterprise Zones.
Read about the taxes and tax incentives offered to new industries starting operations in the state.
