AL SB386

Owners, members, partners, or shareholders of electing pass-through entities are entitled to a tax credit equal to their pro rata or distributive share of Alabama income tax paid by the entity for tax years beginning January 1, 2021 or later.

Owners, members, partners, or shareholders must report their pro rata or distributive share of entity income in accordance with existing provisions of Chapters 16 and 18 of Title 40.

Any conflicting provisions in Chapters 16 or 18 of Title 40 regarding liability of pass-through entity owners for income tax on their pro rata or distributive share are superseded by this act.

The Department of Revenue is authorized to adopt rules for implementation and administration of this act.

The act becomes effective immediately upon passage and approval by the Governor, or upon otherwise becoming law.