Tax Credit Information for Corporations

C Corporations may receive a dollar-for-dollar credit of up to 100% of their state tax liability, and there is no maximum.

A payment made by C corporations to a charitable organization may qualify as an ordinary and necessary business expense deduction. By characterizing a charitable donation to an SGO as a business expense, C corporations reduce their taxable income at the entity level.

The Alabama Accountability Act currently establishes an annual $40 million statewide limit on the tax credits. The credits are awarded on a first-come, first-served basis, and may be carried forward for 3 years.

The deadline each year is December 31.