Prerequisites for claiming the Investment Credit claim through My Alabama Taxes:
- A letter from ALDOR directing the incentivized company to submit an allocation schedule via My Alabama Taxes. ALDOR’s letter is initiated when the Department of Commerce forwards the Investment Credit Certificate to ALDOR.
Procedures for submitting an allocation schedule online through My Alabama Taxes:
- Log in to My Alabama Taxes.
- Once logged in, navigate to the Pass-through Entity or Business Income Tax under the Accounts tab.
- Under the ‘Tax Incentives’ box, click on the ‘Submit investment allocation schedule’ link and select the “Project Number” from the drop-down menu. The Project number will be provided in the letter from ALDOR.
- Complete the required fields as follows:
Part I – Project Information
- Information for (choose one): Select “Incentivized Company.”
- Project Name: Project Name assigned by the Department of Commerce.
- Tax Year Credit Will Be Claimed: Enter the tax year in which the credit will be claimed. The incentivized company may elect to utilize the credit in the tax year that includes the end date of the reporting year or the start date of the reporting year period, provided that the issuance of the tax credit certificate is no later than 30 days prior to the incentivized company’s income tax due date, including extension. This election is made in the first year of receiving the annual certification and shall remain constant for all subsequent years the annual Investment Credit is available for a project.
Part II – Allocation Information
- Allocate the full credit amount against the appropriate tax types.
- If allocating to owners of pass-through entities, or other business entities allowed by the state project agreement, enter the appropriate information under the “Allocation” section.
- If transferring the credit allowed by the state project agreement, enter the amount to be transferred. Enter the transferee information, if known at the time of submitting the allocation schedule. If the transferee information is not available at this time, please contact the Office of Economic Development when the transferee information is available. Transfers are only allowed to an investing company that has the transfer provision provided for in the State Project Agreement and for which the transfer contract has been approved by the Department of Commerce.
Please review the information in full and submit the online schedule. Once the annual allocation has been made, the allocation cannot be amended. Any unused credit associated with the annual allocation can be carried forward for up to five years.
Once ALDOR reviews the allocation schedule, a web notice will be sent to the investing company notifying them of whether their allocation schedule has been rejected or approved. If the allocation schedule is approved, the business entity can claim the income tax credit on their return. Any business entities that have been allocated the credit will receive a letter from ALDOR to submit an allocation schedule via My Alabama Taxes.
NOTE: If you are allocating the credit to an individual taxpayer, you must notify them of the amount of credit allocated.