SB375 Summary

• Adds Section 40-18-39.1 to Alabama Code allowing corporations in a controlled group that includes insurance companies to include other members' business interest income when calculating deductions for business interest expense limitations.

• Requires corporations to make an opt-out election under 26 U.S.C. § 168(k)(7) for all classes of qualified property placed in service during the taxable year.

• Limits eligibility to controlled groups primarily engaged in life and annuity insurance or property and casualty insurance business, classified under NAICS code 524113 or 524126.

• Applies retroactively to taxable years beginning after December 31, 2018, in response to federal Tax Cuts and Jobs Act limitations on business interest expense deductions.

• Becomes effective the first day of the third month following passage and gubernatorial approval.