HB199 Alabama 2012 Session

Under existing law, there is no definition of the term unitary business for taxable purpose

Existing law levies an income tax on corporations. Alabama corporate income tax law is linked to federal corporate income tax law, which allows a domestic production activities deduction that is equal to a percentage of income earned from domestic production or taxable income, whichever is less

Also under existing law, Alabama corporate income tax law is linked to the federal corporate income tax law, which allows a temporary increase in the bonus depreciation deduction from 50 percent to 100 percent of the adjusted basis of qualified property pursuant to the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (Public Law 111-312)

This bill defines unitary business and requires taxpayers who are part of a unitary business to use a combined report to determine their Alabama taxable income

This bill would limit the Alabama deduction to three percent of qualifying income

This bill would limit the Alabama deduction to 50 percent of the adjusted basis of qualified property

To amend Sections 40-18-1, 40-18-34, and 40-2A-17, Code of Alabama 1975, to provide for additional definitions; to require taxpayers who are part of a unitary business to use a combined report to determine their Alabama taxable income; to limit the domestic production activities deduction to three percent of qualified production activities income or taxable income, whichever is less; and to limit the bonus depreciation deduction to 50 percent of the adjusted basis of qualified property.