AL
Alabama House Bill HB543

Alabama 2025 Regular Session

Alabama House Bill HB543 Compare Versions

Only one version of the bill is available at this time.
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33 HB543
44 6YA5X3Z-1
55 By Representative Brown
66 RFD: Ways and Means General Fund
77 First Read: 08-Apr-25
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1212 5 6YA5X3Z-1 04/08/2025 RA (L)evp 2025-1587
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1414 First Read: 08-Apr-25
1515 SYNOPSIS:
1616 Under existing law certain tangible personal
1717 property, up to a certain market value, is exempt from
1818 payment of the state levied ad valorem tax.
1919 This bill would increase the threshold amount of
2020 the market value of tangible personal property that can
2121 be exempt from the state levied ad valorem tax.
2222 This bill would also make nonsubstantive,
2323 technical revisions to update the existing code
2424 language to current style.
2525 A BILL
2626 TO BE ENTITLED
2727 AN ACT
2828 Relating to exemptions from taxation and licenses; to
2929 amend Section 40-9-1, Code of Alabama 1975; to increase the
3030 market value threshold amount for which tangible personal
3131 property is exempt from the state ad valorem tax; and to make
3232 nonsubstantive, technical revisions to update the existing
3333 code language to current style.
3434 BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
3535 Section 1. Section 40-9-1, Code of Alabama 1975, is
3636 amended to read as follows:
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6666 amended to read as follows:
6767 "§40-9-1
6868 The following property and persons shall be exempt from
6969 ad valorem taxation and none other:
7070 (1) All bonds of the United States and this state and
7171 all county and municipal bonds issued by counties and
7272 municipalities in this state, all property, real and personal,
7373 of the United States and this state and of county and
7474 municipal corporations in this state; all cemeteries, all
7575 property, real and personal, used exclusively for religious
7676 worship, for schools or for purposes purely charitable;
7777 provided, that property, real or personal, owned by any
7878 educational, religious, or charitable institution, society or
7979 corporation let for rent or hire or for use for business
8080 purposes shall not be exempt from taxation, notwithstanding
8181 that the income from such property shall be used exclusively
8282 for education, religious, or charitable purposes; all
8383 mortgages, together with the notes, debts, and credits secured
8484 thereby on real and personal property situated in this state,
8585 which mortgages have been filed for record and the privilege
8686 tax paid thereon; all security agreements and security
8787 interests under the Uniform Commercial Code, together with the
8888 notes, debts, and credits secured thereby; all money on
8989 deposit in any bank or banking institution and all other
9090 solvent credits; and all warrants issued by county boards of
9191 education and city boards of education for the purpose of
9292 erecting, repairing, furnishing school buildings, or for other
9393 school purposes.
9494 (2) All property, real or personal, used exclusively
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124124 (2) All property, real or personal, used exclusively
125125 for hospital purposes, to the amount of seventy-five thousand
126126 dollars ($75,000), where such hospitals maintain wards for
127127 charity patients or give treatment to such patients; provided,
128128 that the treatment of charity patients constitutes at least 15
129129 percent of the business of such hospitals; provided further,
130130 that such hospital need not be assessed for taxation if the
131131 owner or manager shall file with the county tax assessor
132132 wherein such hospital is located within the time allowed for
133133 assessing the property for taxation a certificate that such
134134 hospital has done 15 percent charity work in the preceding tax
135135 year; and further provided, that such hospital through its
136136 owner or manager shall have until the expiration of the
137137 preceding tax year to class its work and ascertain whether or
138138 not such hospital has done 15 percent of its treatment of
139139 patients as charity work.
140140 (3) The shares of the capital stock of any corporation
141141 owning and operating a hospital, to the extent of seventy-five
142142 thousand dollars ($75,000) in value; provided, that the
143143 corporation maintains wards for charity patients and gives
144144 treatment to such patients, which treatment constitutes at
145145 least 15 percent of the business of the hospital of the
146146 corporation; provided, that the total exemption granted to any
147147 such corporation shall not exceed seventy-five thousand
148148 dollars ($75,000), taking into consideration its real and
149149 personal property and the value of its shares of capital
150150 stock.
151151 (4) All property owned by the American Legion or by
152152 Veterans of Foreign Wars or by the Disabled American Veterans,
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182182 Veterans of Foreign Wars or by the Disabled American Veterans,
183183 or any post thereof; provided, that such property is used and
184184 occupied exclusively by the organization.
185185 (5) All the property of literary and scientific
186186 institutions and literary societies, when employed or used in
187187 the regular business of the institutions.
188188 (6) The libraries of ministers of the gospel, all
189189 libraries other than those of a professional character and all
190190 religious books kept for sale by ministers of the gospel and
191191 colporteurs.
192192 (7) The property of individuals who are deaf, hard of
193193 hearing, or insane to the extent of three thousand dollars
194194 ($3,000) and the property of blind individuals to the extent
195195 of twelve thousand dollars ($12,000).
196196 (8) All family portraits.
197197 (9) All cotton, livestock, or agricultural products
198198 that have been raised or grown in the State of Alabama and
199199 remain in the hands of the producer thereof, or his or her
200200 landlord, or in the hands of a cooperative association for all
201201 time, and for a period of one year in the hands of the
202202 purchaser or the manufacturer.
203203 (10) All cotton, wherever grown, stored in licensed
204204 warehouses in the State of Alabama for a period not exceeding
205205 12 months.
206206 (11) Provisions and supplies on hand for the current
207207 year for the use of the family and the making of crops; all
208208 wearing apparel; farming tools; tools and implements of
209209 mechanics to the value of two hundred dollars ($200); all
210210 livestock, including mules, studs, jacks and jennets, cattle,
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240240 livestock, including mules, studs, jacks and jennets, cattle,
241241 horses, cows, calves, hogs, sheep, and goats; and household
242242 and kitchen furniture and one sewing machine.
243243 (12) No license or taxation of any character, except
244244 franchise taxes provided by Section 229 of the Constitution of
245245 the State of Alabama of 2022, shall be collected or required
246246 to be paid to the state or any county or municipality therein
247247 by any state or county fair, agricultural association, or
248248 stock, kennel, or poultry show. Athletic stadiums owned and
249249 controlled by universities, schools, or colleges and which are
250250 used exclusively for the purpose of promoting intercollegiate
251251 or interschool athletics; provided, that the revenue received
252252 from athletic stadiums, when admission is charged, shall be
253253 used for the benefit of athletic associations of such
254254 universities, colleges, or schools. Nothing contained in this
255255 subdivision shall be construed to prohibit any municipality,
256256 county, or state from imposing any license tax upon or for the
257257 privilege of engaging in the business of supplying services
258258 for hire or reward or selling commodities other than
259259 livestock, farm products, or farm implements or conducting or
260260 operating devices or games of skill or amusements or other
261261 games or devices, or conducting or operating shows, displays
262262 or exhibits other than shows, displays or exhibits of
263263 agricultural implements, farm products, livestock, and
264264 athletic prowess.
265265 (13) All material, including , without limitation , coke,
266266 to be compounded or further manufactured, when stocked at any
267267 plant or furnace for manufacturing purposes in Alabama.
268268 (14) All articles manufactured in Alabama, including
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298298 (14) All articles manufactured in Alabama, including
299299 pig iron, in the hands of the producer or manufacturer
300300 thereof, for 12 months after its production or manufacture.
301301 (15) All property, both real and personal, owned by any
302302 unit or organization of the Alabama National Guard officially
303303 recognized as such by the federal government and organized and
304304 maintained by the state, and all property owned by shares and
305305 used exclusively by and kept exclusively in the possession of
306306 any such unit or organization of the Alabama National Guard,
307307 the annual rent or hire of which is not in excess of the
308308 annual state, county, and municipal taxes on the property
309309 shall be exempt from taxation by the state, and the county and
310310 municipality in which the same may be situated.
311311 (16) All poultry.
312312 (17) The property of all incompetent veterans to the
313313 value of three thousand dollars ($3,000).
314314 (18) The following items of personal property when
315315 owned by individuals for personal use in the home or usually
316316 kept at the home of the owner and not carried as stocks of
317317 merchandise, namely: Libraries; phonographs; pianos and other
318318 musical instruments; paintings; precious stones, jewelry,
319319 plate silverware, ornaments, and articles of taste; watches
320320 and clocks; wagons, buggies, bicycles, guns, pistols, canes,
321321 golf sticks, golf bags, and sporting goods; money hoarded;
322322 radios; mechanical and electrical refrigerators; and
323323 electrical appliances.
324324 (19) All property owned by the Benevolent and
325325 Protective Order of Elks, Fraternal Order of Police, Fraternal
326326 Order of Eagles, or Loyal Order of Moose, or lodge thereof;
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356356 Order of Eagles, or Loyal Order of Moose, or lodge thereof;
357357 provided, that such property is used and occupied exclusively
358358 by such organization.
359359 (20) All devices, facilities, or structures, and all
360360 identifiable components thereof or materials for use therein,
361361 acquired or constructed primarily for the control, reduction,
362362 or elimination of air or water pollution.
363363 (21) Tobacco leaf stored in hogsheads.
364364 (22) All farm tractors, as that term is defined in
365365 Section 32-1-1.1; and all farming implements, as that term is
366366 used in subdivision (b)(5) of Section 40-11-1(b)(5), when used
367367 exclusively in connection with agricultural property as
368368 defined in subdivision (b)(1) of Section 40-8-1(b)(1).
369369 (23) All grain bins used exclusively for the purpose of
370370 storing, holding, drying, preserving, or otherwise preparing a
371371 grain, as defined in Section 2-31-1, for market. For purposes
372372 of this chapter, "grain bin" means a structure and its
373373 component parts.
374374 (24) All stocks of goods, wares, and merchandise
375375 described in subdivision (b)(4) of Section 40-11-1(b)(4).
376376 (25) All aircraft, replacement parts, components,
377377 systems, supplies, and sundries affixed or used on the
378378 aircraft, and ground support equipment and vehicles used by or
379379 for the aircraft, when used by a certificated or licensed air
380380 carrier with a hub operation within this state, for use in
381381 conducting intrastate, interstate, or foreign commerce for
382382 transporting people or property by air. For the purpose of
383383 this subdivision, the words "hub operation" within this state
384384 shall be construed to have all of the following criteria:
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414414 shall be construed to have all of the following criteria:
415415 a. There originates from the location 15 or more flight
416416 departures and five or more different first-stop destinations
417417 five days per week for six or more months during the calendar
418418 year.
419419 b. Passengers or property or both are regularly
420420 exchanged at the location between flights of the same or a
421421 different certificated or licensed air carrier.
422422 (26) All property described in Title 12 U.S.C. § 1701q,
423423 commonly known as HUD 202 property, is hereby exempt from any
424424 and all ad valorem taxes.
425425 (27) All vessels and equipment thereon, used
426426 predominantly in the business of commercial fishing, as
427427 defined in Section 40-23-1, by the owners thereof.
428428 (28)a. The tangible personal property owned by a
429429 business and reported in accordance with Article 1 of Chapter
430430 7 to the extent of forty one hundred thousand dollars
431431 ($40,000)($100,000) in market value is exempt from the state
432432 levied ad valorem tax.
433433 b. Any county or municipality, by resolution or
434434 ordinance, may adopt the exemption provided in paragraph a.
435435 for county or municipal ad valorem taxes levied on tangible
436436 personal property. The ordinance or resolution must be adopted
437437 at least 90 days prior to October 1, 2023, or 90 days prior to
438438 October 1 of the electing year."
439439 Section 2. This act shall become effective on October
440440 1, 2025.
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