Prerequisites for claiming the Investment Credit claim through My Alabama Taxes:

• A letter from ALDOR directing to submit an allocation schedule via My Alabama Taxes. ALDOR’s letter is initiated by the allocation of the credit from the incentivized company (or allocating entity) receiving the tax credit certification.

Procedures for submitting an allocation schedule online through My Alabama Taxes:

• Log in to My Alabama Taxes.
• Once logged in, navigate to the Pass-through Entity, Business Income Tax, or Financial Institution Tax under the Accounts tab.
• Under the ‘Tax Incentives’ box, click on the ‘Submit investment allocation schedule’ link and select the “Project Number” from the drop-down menu. The Project number will be provided in the letter from ALDOR.
• Complete the required fields as follows:

Part I – Project Information

• Information for (choose one): Select “Allocating Entity.”
• Tax Year Credit Will Be Claimed: Enter the tax year in which the credit will be claimed. The allocating entity may elect to utilize the credit in the tax year that includes the end date of the reporting year or the start date of the reporting year period, provided that the issuance of the tax credit certificate is no later than 30 days prior to the allocating entity’s income tax due date, including extension. This election is made with the filing of the tax return corresponding to the allocating company’s first reporting year and shall remain constant for all subsequent years the annual Investment Credit is available.

Part II – Allocation Information

• Allocate the full credit amount against the appropriate tax types.
• If allocating to owners of pass-through entities, enter the appropriate information under the “Allocation” section.

Please review the information in full and submit the online schedule. Once the annual allocation has been made, the allocation cannot be amended. Any unused credit associated with the annual allocation can be carried forward for up to five years.

Once ALDOR reviews the allocation schedule, a web notice will be sent to the allocating entity notifying whether the allocation schedule has been rejected or approved. If the allocation schedule is approved, the business entity can claim the income tax credit on their return. If allocating the credit to owners of a pass-through entity that are business entities, these entities will receive a letter from ALDOR to submit an allocation schedule via My Alabama Taxes.

NOTE: If you are allocating the credit to an individual taxpayer, you must notify them of the amount of credit allocated.