Credits for taxes paid on income from sources without the state and for job development fees.
(a)(1) For the purpose of ascertaining the income tax due under the provisions of this chapter by individual residents of Alabama whose gross income, as defined herein, is derived from sources both within and without the State of Alabama, there shall be allowed a credit against the amount of tax found to be due by such resident, on account of income derived from without the State of Alabama, the amount of income tax actually paid by such resident to any state or territory on account of business transacted or property held without the State of Alabama.
(2) In case the amount of tax actually paid by an individual resident of Alabama to another state or territory is in excess of the amount that would be due on the same income computed on the income tax rate in Alabama, then only such amount as would be due in this state on such taxable income shall be allowed as a credit
(3) If the amount of income tax actually paid by an individual resident of this state to any other state or territory on account of business transacted or property held is less than the amount of tax that would be due, as computed on Alabama income tax rates, then the income tax levied herein shall be computed on the entire taxable income from sources from both within and without the state as defined herein, and the tax shall be paid less the credit allowed in this section for tax paid on income derived from without the state.
(4) Before a resident of Alabama may claim the credit allowed under this subsection (a), he or she shall file with his or her tax return a certificate showing amount of gross and net income derived from sources without this state together with the amount of tax paid or to be paid on such income.
(b) Any taxpayer described in Section 40-18-2(1) or Section 40-18-2(6), who, during any year, has been assessed a job development fee as described in Section 41-10-44.8(b), shall be allowed a credit against the amount of income tax due under the provisions of this chapter in such year in an amount equal to the job development fee withheld from the taxpayer's wages during the year.
(c)(1) A resident individual taxpayer, who is either a partner or member of a Subchapter K entity, a shareholder of an Alabama S corporation, or a beneficiary of an estate or trust, during all or part of a year, shall be allowed a credit equal to his or her proportionate share of the income taxes paid or accrued, including a payment recognized by 26 U.S.C. §901, to a foreign country with respect to the trade or business income of such business, including related operations and affiliates, whose income in the foreign country is all principally related to the following 2002 North American Industry Classification System Sectors and Subsectors in all of the following manners:
a. The income must be related to Sector 21.
b. The income must be related to at least two of the following Subsectors: 324, 325, 482, 483, and 486.
c. The income must be attributable to the foreign country.
(2) Notwithstanding the foregoing, the credit allowed in this subsection shall not exceed the amount of income tax that would otherwise be imposed by Alabama on the individual's income derived from the foreign country.
(Acts 1935, No. 194, p. 256; Code 1940, T. 51, §390; Acts 1993, 1st Ex. Sess., No. 93-852, p. 95, §3; Acts 1997, No. 97-625, p. 1048, §3; Act 2007-366, p. 718, §1.)
Credits for taxes paid on income from sources without the state and for job development fees.
(a)(1) For the purpose of ascertaining the income tax due under the provisions of this chapter by individual residents of Alabama whose gross income, as defined herein, is derived from sources both within and without the State of Alabama, there shall be allowed a credit against the amount of tax found to be due by such resident, on account of income derived from without the State of Alabama, the amount of income tax actually paid by such resident to any state or territory on account of business transacted or property held without the State of Alabama.
(2) In case the amount of tax actually paid by an individual resident of Alabama to another state or territory is in excess of the amount that would be due on the same income computed on the income tax rate in Alabama, then only such amount as would be due in this state on such taxable income shall be allowed as a credit
(3) If the amount of income tax actually paid by an individual resident of this state to any other state or territory on account of business transacted or property held is less than the amount of tax that would be due, as computed on Alabama income tax rates, then the income tax levied herein shall be computed on the entire taxable income from sources from both within and without the state as defined herein, and the tax shall be paid less the credit allowed in this section for tax paid on income derived from without the state.
(4) Before a resident of Alabama may claim the credit allowed under this subsection (a), he or she shall file with his or her tax return a certificate showing amount of gross and net income derived from sources without this state together with the amount of tax paid or to be paid on such income.
(b) Any taxpayer described in Section 40-18-2(1) or Section 40-18-2(6), who, during any year, has been assessed a job development fee as described in Section 41-10-44.8(b), shall be allowed a credit against the amount of income tax due under the provisions of this chapter in such year in an amount equal to the job development fee withheld from the taxpayer's wages during the year.
(c)(1) A resident individual taxpayer, who is either a partner or member of a Subchapter K entity, a shareholder of an Alabama S corporation, or a beneficiary of an estate or trust, during all or part of a year, shall be allowed a credit equal to his or her proportionate share of the income taxes paid or accrued, including a payment recognized by 26 U.S.C. §901, to a foreign country with respect to the trade or business income of such business, including related operations and affiliates, whose income in the foreign country is all principally related to the following 2002 North American Industry Classification System Sectors and Subsectors in all of the following manners:
a. The income must be related to Sector 21.
b. The income must be related to at least two of the following Subsectors: 324, 325, 482, 483, and 486.
c. The income must be attributable to the foreign country.
(2) Notwithstanding the foregoing, the credit allowed in this subsection shall not exceed the amount of income tax that would otherwise be imposed by Alabama on the individual's income derived from the foreign country.
(Acts 1935, No. 194, p. 256; Code 1940, T. 51, §390; Acts 1993, 1st Ex. Sess., No. 93-852, p. 95, §3; Acts 1997, No. 97-625, p. 1048, §3; Act 2007-366, p. 718, §1.)
Credits for taxes paid on income from sources without the state and for job development fees.
(a)(1) For the purpose of ascertaining the income tax due under the provisions of this chapter by individual residents of Alabama whose gross income, as defined herein, is derived from sources both within and without the State of Alabama, there shall be allowed a credit against the amount of tax found to be due by such resident, on account of income derived from without the State of Alabama, the amount of income tax actually paid by such resident to any state or territory on account of business transacted or property held without the State of Alabama.
(2) In case the amount of tax actually paid by an individual resident of Alabama to another state or territory is in excess of the amount that would be due on the same income computed on the income tax rate in Alabama, then only such amount as would be due in this state on such taxable income shall be allowed as a credit
(3) If the amount of income tax actually paid by an individual resident of this state to any other state or territory on account of business transacted or property held is less than the amount of tax that would be due, as computed on Alabama income tax rates, then the income tax levied herein shall be computed on the entire taxable income from sources from both within and without the state as defined herein, and the tax shall be paid less the credit allowed in this section for tax paid on income derived from without the state.
(4) Before a resident of Alabama may claim the credit allowed under this subsection (a), he or she shall file with his or her tax return a certificate showing amount of gross and net income derived from sources without this state together with the amount of tax paid or to be paid on such income.
(b) Any taxpayer described in Section 40-18-2(1) or Section 40-18-2(6), who, during any year, has been assessed a job development fee as described in Section 41-10-44.8(b), shall be allowed a credit against the amount of income tax due under the provisions of this chapter in such year in an amount equal to the job development fee withheld from the taxpayer's wages during the year.
(c)(1) A resident individual taxpayer, who is either a partner or member of a Subchapter K entity, a shareholder of an Alabama S corporation, or a beneficiary of an estate or trust, during all or part of a year, shall be allowed a credit equal to his or her proportionate share of the income taxes paid or accrued, including a payment recognized by 26 U.S.C. §901, to a foreign country with respect to the trade or business income of such business, including related operations and affiliates, whose income in the foreign country is all principally related to the following 2002 North American Industry Classification System Sectors and Subsectors in all of the following manners:
a. The income must be related to Sector 21.
b. The income must be related to at least two of the following Subsectors: 324, 325, 482, 483, and 486.
c. The income must be attributable to the foreign country.
(2) Notwithstanding the foregoing, the credit allowed in this subsection shall not exceed the amount of income tax that would otherwise be imposed by Alabama on the individual's income derived from the foreign country.
(Acts 1935, No. 194, p. 256; Code 1940, T. 51, §390; Acts 1993, 1st Ex. Sess., No. 93-852, p. 95, §3; Acts 1997, No. 97-625, p. 1048, §3; Act 2007-366, p. 718, §1.)
