AL
Alabama Senate Bill SB152

Alabama 2022 Regular Session

Alabama Senate Bill SB152 Compare Versions

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11 1 SB152
2-2 216567-4
2+2 216567-1
33 3 By Senators Roberts, Elliott, Sessions, Butler, Allen,
44 4 Shelnutt, Williams, Jones, Coleman-Madison, Singleton, Orr,
55 5 Hatcher, Chambliss, Price, Smitherman, Beasley, Weaver,
66 6 Figures, Reed, Waggoner, Stutts, Givhan, Chesteen, Whatley,
77 7 Scofield, Melson, Holley, Barfoot, Gudger, Marsh and
88 8 Livingston
99 9 RFD: Finance and Taxation Education
1010 10 First Read: 01-FEB-22
1111
12-Page 0 SB152
13-1 SB152
14-2
15-3
16-4 ENROLLED, An Act,
17-5 Relating to taxation; to provide that the deduction
18-6 allowed to individual taxpayers for federal income tax paid or
19-7 accrued within the tax year ending December 31, 2021 will be
20-8 determined without considering the reduction in federal tax
21-9 attributable to any additional federal child tax credit,
22-10 federal earned income tax credit, or federal child and
23-11 dependent care tax credit received pursuant to the American
24-12 Rescue Plan Act of 2021, in order to allow individuals to
25-13 receive the amount of the enhanced federal credits rather than
26-14 pay state income tax on a portion of the amounts received; to
27-15 authorize the Department of Revenue to adopt rules.
28-16 BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
29-17 Section 1. For the tax year ending on December 31,
30-18 2021, for purposes of determining an individual taxpayer's
31-19 federal income tax deduction pursuant to Chapter 18 of Title
32-20 40, Code of Alabama 1975, the federal income tax deduction
33-21 shall be calculated without consideration of the reductions in
34-22 federal tax provided in Sections 9611, 9612, 9621, 9622, 9623,
35-23 9624, 9625, 9626, and 9631 of the American Rescue Plan Act of
36-24 2021, and instead, for any federal income tax reductions
37-25 attributable to the federal child tax credit, the earned
38-Page 1 SB152
39-1 income tax credit, and the federal child and dependent care
40-2 tax credits, the federal income tax deduction shall be
41-3 calculated as if the individual paid the federal income tax
42-4 that would otherwise have been paid under the provisions of
43-5 the Internal Revenue Code in effect on December 31, 2020.
44-6 Section 2. The Department of Revenue may adopt rules
45-7 to implement this act.
46-8 Section 3. This act shall become effective
47-9 immediately following its passage and approval by the
48-10 Governor, or its otherwise becoming law.
49-Page 2 SB152
50-1
12+Page 0 1 216567-1:n:01/19/2022:LSA-BY/ccd
5113 2
5214 3
5315 4
54-President and Presiding Officer of the Senate
55-
5616 5
57-6 Speaker of the House of Representatives
58-SB1527
59-8 Senate 03-FEB-22
60-9 I hereby certify that the within Act originated in and passed
61-10 the Senate.
62-11
63-12 Patrick Harris,
64-13 Secretary.
65-14
66-15
67-16
68-17 House of Representatives
69-18 Amended and passed 17-FEB-22
70-19
71-20
72-21 Senate concurred in House amendment 22-FEB-22
73-22
74-23
75-24 By: Senator Roberts
76-Page 3
17+6
18+7
19+8 SYNOPSIS: Under existing law, amounts received as
20+9 federal child tax credits under Internal Revenue
21+10 Code Section 24, as federal earned income tax
22+11 credits under Internal Revenue Code Section 32, or
23+12 as child and dependent care tax credits under
24+13 Internal Revenue Code Section 21 reduce the federal
25+14 income tax deduction allowed for Alabama individual
26+15 taxpayers.
27+16 Under existing law, the enhanced, federal
28+17 expansion of these credits under the American
29+18 Rescue Plan Act, which will be granted to
30+19 individual taxpayers in the tax year ending
31+20 December 31, 2021, would increase Alabama
32+21 individual taxable income for the 2021 tax year.
33+22 This bill would create an allotment in the
34+23 state income tax law to conform with the federal
35+24 intent behind the income tax credit expansion
36+25 within the American Rescue Plan Act and would
37+26 provide that the reduction in the individual
38+27 federal income tax deduction associated with the
39+Page 1 1 federal child tax credits, earned income tax
40+2 credits, and child and dependent care tax credits
41+3 for the tax year ending on December 31, 2021, would
42+4 be calculated as if the individual paid the federal
43+5 income tax that would otherwise have been paid
44+6 under the provisions of the Internal Revenue Code
45+7 in effect on December 31, 2020.
46+8 Under current law, the due date for a
47+9 corporate income tax return and financial
48+10 institution excise tax return is the same as the
49+11 corresponding federal income tax return.
50+12 This bill would provide for a one-month
51+13 extension of the due date of tax returns for
52+14 Alabama financial institution excise taxpayers and
53+15 corporate income taxpayers in tax years beginning
54+16 on or after January 1, 2021, in order to provide
55+17 taxpayers with additional time to calculate their
56+18 tax liabilities under new federal and state tax
57+19 law, without incurring a late filing penalty. The
58+20 filing extension would not extend the due date of
59+21 the tax liability by these taxpayers.
60+22 This bill would also authorize the
61+23 Department of Revenue, in its discretion, to extend
62+24 the due date of tax returns for Alabama financial
63+25 institution excise taxpayers and corporate income
64+26 taxpayers by one month in tax years beginning on or
65+27 after January 1, 2020, but before January 1, 2021.
66+Page 2 1
67+2 A BILL
68+3 TO BE ENTITLED
69+4 AN ACT
70+5
71+6 Relating to taxation; to provide that the deduction
72+7 allowed to individual taxpayers for federal income tax paid or
73+8 accrued within the tax year ending December 31, 2021 will be
74+9 determined without considering the reduction in federal tax
75+10 attributable to any additional federal child tax credit,
76+11 federal earned income tax credit, or federal child and
77+12 dependent care tax credit received pursuant to the American
78+13 Rescue Plan Act of 2021, in order to allow individuals to
79+14 receive the amount of the enhanced federal credits rather than
80+15 pay state income tax on a portion of the amounts received; to
81+16 add Sections 40-16-3.1 and 40-18-39.2 to the Code of Alabama
82+17 1975, to provide for an extension of the due date for tax
83+18 returns for certain taxpayers; and to authorize the Department
84+19 of Revenue to adopt rules.
85+20 BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
86+21 Section 1. For the tax year ending on December 31,
87+22 2021, for purposes of determining an individual taxpayer's
88+23 federal income tax deduction pursuant to Chapter 18 of Title
89+24 40, Code of Alabama 1975, the federal income tax deduction
90+25 shall be calculated without consideration of the reductions in
91+26 federal tax provided in Sections 9611, 9612, 9621, 9622, 9623,
92+27 9624, 9625, 9626, and 9631 of the American Rescue Plan Act of
93+Page 3 1 2021, and instead, for any federal income tax reductions
94+2 attributable to the federal child tax credit, the earned
95+3 income tax credit, and the federal child and dependent care
96+4 tax credits, the federal income tax deduction shall be
97+5 calculated as if the individual paid the federal income tax
98+6 that would otherwise have been paid under the provisions of
99+7 the Internal Revenue Code in effect on December 31, 2020.
100+8 Section 2. Sections 40-16-3.1 and 40-18-39.2 are
101+9 added to the Code of Alabama 1975, to read as follows:
102+10 §40-16-3.1.
103+11 (a)(1) For tax years beginning on or after January
104+12 1, 2021, a financial institution excise taxpayer shall be
105+13 allowed one month following the due date of the corresponding
106+14 federal income tax return, including applicable extensions, to
107+15 file the Alabama financial institution excise tax return as
108+16 required by Section 40-16-3.
109+17 (2) For tax years beginning on or after January 1,
110+18 2020, but prior to January 1, 2021, the department may allow a
111+19 financial institution excise taxpayer one additional month
112+20 following the due date of the corresponding federal income tax
113+21 return, including applicable extensions, to file the Alabama
114+22 financial institution excise tax return, upon request by the
115+23 taxpayer and approval by the department.
116+24 (b) The extension provided in this section shall not
117+25 allow a taxpayer to defer payment of a financial institution
118+26 excise tax liability beyond the original due date provided in
119+27 Section 40-16-3.
120+Page 4 1 §40-18-39.2.
121+2 (a)(1) For tax years beginning on or after January
122+3 1, 2021, a corporate income taxpayer shall be allowed one
123+4 month following the due date of the corresponding federal
124+5 income tax return, including applicable extensions, to file
125+6 the Alabama corporate income tax return as required by Section
126+7 40-18-39.
127+8 (2) For tax years beginning on or after January 1,
128+9 2020, but prior to January 1, 2021, the department may allow a
129+10 corporate income taxpayer one additional month following the
130+11 due date of the corresponding federal income tax return,
131+12 including applicable extensions, to file the Alabama corporate
132+13 income tax return, upon request by the taxpayer and approval
133+14 by the department.
134+15 (b) The extension provided in subsection (a) shall
135+16 not allow a taxpayer to defer payment of a corporate income
136+17 tax liability beyond the original due date provided in Section
137+18 40-18-39.
138+19 Section 3. The Department of Revenue may adopt rules
139+20 to implement this act.
140+21 Section 4. This act shall become effective
141+22 immediately following its passage and approval by the
142+23 Governor, or its otherwise becoming law.
143+Page 5