SB120 Summary

• Standardizes and aligns sales tax and use tax exemptions in Alabama to provide uniformity for taxpayers by incorporating certain sales tax exemptions into use tax law.

• Codifies existing case law regarding the sales and use tax exemption for gross receipts received by learned professionals (accountants, attorneys, and physicians).

• Clarifies that photographers and commissioned portrait artists are not exempt from collecting sales tax; for portraits and photographs made prior to October 1, 2017, neither the Department of Revenue nor local tax officials may seek payment for uncollected sales tax.

• Incorporates all exemptions from Section 40-23-4(a) and 40-23-4.1 into use tax provisions by reference to eliminate duplicative language and ensure consistency.

• Applies retroactively to all open tax years and periods for which assessments could be entered, with no refunds issued for periods prior to the bill's effective date.