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Facility Credit Claim Procedures

Tax Incentives >
  • Facility Credit Claim Procedures
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Procedures for Childcare Facility Tax Credit
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The Facility Tax Credit must be precertified through My Alabama Taxes before a childcare provider can claim the credit on their Alabama tax return. Precertification of this credit is a two-step process requiring taxpayers to first secure a credit reservation. Eligible childcare providers may begin requesting reservations for tax year 2026 on January 5, 2026. Those with an approved reservation must then submit a credit claim at the end of the tax year and include detailed documentation substantiating their claims.

Prerequisites for submitting a Facility Credit Claim through My Alabama Taxes:

  • Taxpayer must have an approved Facility Tax Credit reservation.
  • Childcare provider must own and operate a qualifying childcare facility with eligible children enrolled.
  • An active My Alabama Taxes account for the taxpayer who will utilize the credit. If you need assistance creating a My Alabama Taxes account or are unsure which account the credit will be applied to, contact incentives@revenue.alabama.gov.

Procedures for submitting a Facility Credit Claim through My Alabama Taxes:

  • Visit My Alabama Taxes and log in.
  • Click on the Other Actions tab and select Submit a Childcare Credit Claim under Tax Incentives.
  • Credit Type: Choose Childcare Facility from the drop-down menu and enter the Reservation Year. Select Next.
  • Insurance Company: Select Yes or No to indicate whether you are an insurance company filing an insurance premium tax return with the Department of Insurance and select Next.
  • Facility Information: Complete the required fields and select Next.
  • Credit Claim: Approved facility credit reservations will be shown in the Childcare Credit Reservations table. Complete the required fields for the reservation(s) from which you wish to make a credit claim and select Next.
    • Account ID: Select the account where the credit will be utilized.
    • Filing Period: Select the filing period for which the credit will be claimed.
    • License #: This field will prepopulate based on the information entered when the reservation was made.
    • Credit Reserved: This field will prepopulate to reflect approved credit reservations.
    • Credit Remaining: This field will prepopulate to reflect pending and approved credit claims.
    • Credit Amount Requested: Download and complete the Facility Credit Calculation Spreadsheet to calculate your total credit allowed and enter the total in the credit amount requested box.
    • Note! Taxpayers claiming the credit as an insurance company will not select an account and must manually enter the filing period.
  • Attachments: Attach the completed Facility Credit Calculation Spreadsheet and documentation showing the average monthly number of eligible children enrolled during the tax year. Select Next.
  • Review Submission: Carefully review all information for accuracy (and print a copy of your records), then select Submit.

What to expect after the credit claim is submitted:

  • Credit claims are reviewed by ALDOR in the order received. Processing times may vary depending on the volume of requests.
  • Incomplete or insufficient documentation may delay credit approval or result in the denial of your credit request.
  • You will be contacted via the email address or phone number provided with your request if we have additional questions.
  • The credit will only be awarded after all required documentation is submitted and verified by ALDOR. You will receive a web notice via My Alabama Taxes after we review and approve your credit claim.
  • Pass-through entities that have been awarded a credit must submit a second credit claim through My Alabama Taxes to pass the credit to its owners. Procedures for this process are available below under Additional Resources.
  • If you have questions, email incentives@revenue.alabama.gov or call 334-353-9789.

Additional Resources