HB387 Summary

• Amends Section 40-18-342 of the Code of Alabama to provide an alternative irrigation equipment tax credit for agricultural trades or businesses beginning with tax years after December 31, 2017.

• Authorizes taxpayers to elect either 20% credit capped at $10,000 (existing option) or 10% credit capped at $50,000 (new option), whichever is greater for qualified irrigation equipment, fuel-to-electricity conversions, and qualified reservoirs.

• Applies to purchases and installations of irrigation equipment and qualified reservoir construction, with same eligibility requirements for surface water withdrawal systems (8,000+ cubic feet per second flow exemption) and ground water systems.

• Limits credit to one purchase and installation of qualified irrigation equipment or one qualified reservoir per taxpayer, with carryforward allowed to the five following years if credit exceeds tax liability.

• Subsection (b) expires and is repealed effective December 31, 2022, unless extended by joint resolution enacted by the Legislature.