2022 Code of Alabama
Title 40 - Revenue and Taxation.
Chapter 18 - Income Taxes.
Article 1 - General Provisions.
Section 40-18-24.5 - Refundable Credit for Certain Owners, Members, Partners, or Shareholders of Electing Pass-Through Entities.

Section 40-18-24.5

Refundable credit for certain owners, members, partners, or shareholders of electing pass-through entities.

(a) Notwithstanding any other provision of Chapters 16 and 18 of this title to the contrary, for tax years beginning on or after January 1, 2021, any owner, member, partner, or shareholder of an electing pass-through entity shall report its pro rata or distributive share of the income of the entity in accordance with the provisions of Sections 40-16-4, 40-18-24, 40-18-26, 40-18-27, 40-18-28, 40-18-29, and 40-18-39, as applicable.

(b) The owner, member, partner, or shareholder of an electing pass-through entity reporting income in accordance with subsection (a) shall be entitled to a refundable credit in an amount equal to its pro rata or distributive share of the Alabama income tax paid by the electing pass-through entity with respect to the corresponding tax year.

(c) The Department of Revenue may waive any estimated tax penalties and interest assessments for the quarterly estimated tax payment due on April 15, 2021, which may otherwise be assessed for individual or pass-through entity taxpayers who are adversely impacted by the retroactive effective date of this section.

(d) Any provision of Chapters 16 or 18 of this title regarding the liability of an owner, member, partner, or shareholder of electing pass-through entity for tax imposed by Chapters 16 or 18 of this title on their pro rata or distributive share of an electing pass-through entity’s income that is in conflict with Act 2021-423 is hereby superseded.

(e) The Department of Revenue may adopt rules for the implementation and administration of Act 2021-423.

(Act 2021-423, §1.)