Jobs Act Incentives: This discretionary program offers incentives for job creation and capital investment. To qualify, businesses that operate chemical manufacturing, data center, metal/machining technology or toolmaking, engineering, design, and research facilities must create net new jobs but are not subject to a specific minimum job creation requirement. All other businesses with a qualifying business activity must create a minimum of 50 jobs (25 in a Targeted County). If approved by the Governor, companies may claim either or both of the following incentives:
Port Credit: This discretionary program offers a one-time tax credit for increased usage of Alabama public ports. Shippers must be engaged in manufacturing, warehousing or distribution of goods. The credit is up to $50 per TEU, $3 per net ton or $0.04 per net kilogram. The credit may be taken against Alabama income tax liability and can be carried forward for 5 years. New distribution or warehouse shippers investing at least $20 million and creating at least 75 net new jobs are eligible to receive up to $100 per TEU over a 3-year period if entering into a project agreement with the state.
Growing Alabama Credit: Eligible companies contributing investment for projects approved by the Alabama Renewal Commission to local economic development organizations may qualify for a corporate income tax credit equal to their contribution capped at 50% of tax liability in that year. The program is capped at$10,000,000 for the fiscal years 2017, 2018, 2019, and 2020. Contributions may not be transferred to any other taxpayer. The Growing Alabama Act Income Tax Credit will sunset in 2020.
Full Employment Act of 2011: Businesses with 50 or fewer employees may receive a one-time, non-refundable and non-transferable tax credit equal to $1,000 for every new job created earning over $10 per hour. This credit is not refundable or transferable.
Sales and Use Tax Abatement: Discretionary abatement of the non-educational portion of sales and use taxes on construction materials, equipment and other capitalized costs.
Property Tax Abatement: Discretionary abatement of the non-educational portion of property tax for up to 20 years.
Enterprise Zone Credit/Exemption: Businesses that locate in an Enterprise Zone may receive a tax credit or 5 year tax exemption for new job creation (up to $2,500 per permanent job), investment tax credits, training grants of up to $1,000 per new employee and an exemption of sales and use tax on purchases of construction materials. Employers with existing facilities in an Enterprise Zone that create at least 5 new jobs may also receive incentives.
Employer Education Credit: Tax credits are available to businesses that provide approved basic skills education to Alabama resident employees. The credit is 20% of the actual costs, limited to the employer’s income tax liability. Certain requirements must be met.
Last updated: May 2019