PROCEDURES FOR RESERVING A GROWING ALABAMA CREDIT
Individual and corporate income taxpayers can reserve a Growing Alabama Credit for contributions made to an Economic Development Organization (EDO) for an approved qualifying project. Reservations are made on a first-come, first-served basis, subject to verification by the EDO confirming that the contribution has been received, the project has been funded in accordance with the applicable Growing Alabama Funding Agreement, and the project will be undertaken.
Prerequisite for reserving a Growing Alabama Credit for an approved qualifying project:
- Taxpayers must have a My Alabama Taxes (MAT) account to reserve the credit through the Department’s online reservation system.
Procedures for making an online credit reservation through MAT:
Part I – Make Donation
- Log in to My Alabama Taxes using your login credentials.
- Once logged in, navigate to Business Income Tax or Individual Income Tax under Accounts.
- Under the ‘I Want to’ section, click on ‘Report a donation to an EDO’ and complete the required fields as follows:
- Under ‘Donor Information,’ enter the donor’s contact information and address.
- Under ‘EDO Donation Information,’ click on the project for which you wish to make the credit reservation.
- Donation amount – Enter the amount of credit you are reserving. Please note that the credit reservation is not valid until the EDO confirms your credit reservation and the project is confirmed. In the event that the EDO fails to confirm the project within the 60-day window, the donor will not be allowed to claim the Growing Alabama Credit even if the donation has already been received by the EDO.
- Donation date – Enter the date the reservation is made.
Part II – Review Submission
The donor must agree to the terms and rules of the donation by checking the box before the donation can be submitted. The terms and rules include the following:
- The donor has 21 days from the date of the online credit reservation to make a cash donation to the EDO for the approved project.
- The EDO has 60 days from the date the project is added to the online system to confirm that the taxpayer’s donation has been received, the project has been funded, and the project will be undertaken.
- In the event the taxpayer’s donation is greater than the amount of the reservation, the credit is limited to the amount of the reservation available for the project.
- The credit is only available to an individual or a corporate entity making the donation. The credit will not pass through to owners of a pass-through entity.
- The donor acknowledges the disclosure requirements under Section 41-29-3, Code of Alabama, and shall disclose the amount of the Growing Alabama Credit received and the realized benefits to the Secretary of Commerce. The information provided shall subsequently be included in the Department of Commerce’s reporting requirements under Section 40-1-50, Code of Alabama.
What to expect after the online credit reservation is submitted through the online portal (MAT):
- The donor will receive a confirmation number acknowledging the receipt of the reservation.
- The donor will receive a subsequent email and a notice from MAT notifying whether their donation has been approved or denied by the EDO.
- If the donation is approved and the project is confirmed by the EDO, the donor will receive a letter from the Department of Revenue confirming their Growing Alabama Credit.