AL Senate passes critical tax relief bills for small businesses and farmers

The State Senate today passed Small Business Relief and Revitalization Act of 2022 (SB189) that would provide several significant relief provisions for Alabama taxpayers and small businesses.

SB189 would ensure economic relief for farmers affected by American Rescue Plan Act of 2021 (ARPA) by providing that income resulting from loan forgiveness for disadvantaged farmers and ranchers not be treated as income under Alabama law and thereby should not be considered in determining deductibility expenses, and should be excluded from calculations in determining federal income tax deduction.

The same bill would provide relief for businesses by realigning the filing date for corporate tax returns, allowing a one-month extension from the tax returns due date for Alabama financial institutions, excise taxpayers and corporate income tax taxpayers.

It would also relieve regulatory burdens and provide tax relief for small businesses by increasing the estimated threshold calculation from $2,500 to $5,000. This would allow sales tax licensees the option of a certified funds payment in lieu of surety bond and exempts up to $40,000 in businesses’ personal property from ad valorem taxation by the state.

“This is a huge victory for Alabama taxpayers and small businesses,” said State Senator Garlan Gudger (R-Cullman). “I appreciate the support of Lt. Gov. Will Ainsworth, Representative Danny Garrett, and my Senate colleagues from both sides of the aisle to tackle this important issue. The momentum is strong to ensure the business environment in Alabama thrives and prospers, with continued possibilities for opportune growth and development.”

The bill and its companion bill HB82, sponsored by State Representative Danny Garrett (R-Trussville), both passed with overwhelming support in the Senate.

“Small businesses are vital to the viability and sustainability of Alabama’s economy,” said Sen. Gudger. “These businesses are the foundation of our communities and faced extreme obstacles and challenges as a result of the pandemic.

“Small businesses took a major hit over the last two years, and the pandemic substantially hindered growth and job creation for these enterprises. We have made a great effort in the legislature throughout that time to provide them with the much-needed relief they deserve.”