The taxable shares base shall be determined as follows:
(a) Multiply the corporation's initial taxable shares base by the apportionment factor used to apportion the corporation's income to Alabama for purposes of the Alabama income tax in accordance with Chapter 18 or that would be used if the corporation were subject to income tax under Chapter 18.
(b) From the amount determined in subsection (a), deduct the following:
(1) The book value of all devices, facilities, or structures, and all identifiable components or materials for use therein, that are located in Alabama and are acquired or constructed primarily for the control, reduction, or elimination of air, ground, or water pollution or radiological hazards where such pollution or radiological hazards result from or would be caused by activities of the taxpayer in Alabama;
(2) The net amount invested by the taxpayer in any bond or other security issued before January 1, 2000, by the State of Alabama, or any county, municipality, or other political subdivision of the State of Alabama, or any public corporation agency or instrumentality of the foregoing but only until the year in which occurs the earlier of the final maturity date thereof or the date on which the principal of the bond or security shall be called for optional redemption prior to the final maturity thereof. For purposes of this subdivision, "net amount invested" means the amount of cash, including any premium and net of any discount, paid as the purchase price for the bond or other security, less the amount of any premium amortized and plus the amount of any discount accreted to the date of calculation, reduced by the proportionate amount of principal on the bond or other security that is amortized or otherwise paid or retired. This subdivision shall not apply if the taxpayer is a dealer in securities subject to the rules of 26 U.S.C. §1236;
(3) The balance of any reserve, account, or trust reasonably determined to satisfy any liability that is imposed by federal, state, or local government laws or regulations for reclamation, storage, disposal, decontamination, retirement, or other related costs associated with a plant, facility, mine, or site in Alabama;
(4) During the period beginning December 1, 1997, and ending on the date 20 years thereafter, the amount invested in all new and existing manufacturing facilities in this state by the taxpayer, which amount shall be limited to the investment in all real and tangible personal property, equipment, facilities, structures, components, and inventory in this state, provided that the taxpayer has met the criteria in paragraph a. below, and, in addition, has met the criteria in paragraph b. below:
a. The taxpayer must, not later than December 31, 2000, file with the department a statement of intent to claim the deduction provided under this section. This statement of intent shall contain any information required by the department.
b. During the period commencing with December 1, 1997, and ending on the date six years thereafter, the amount of new investment in all new and existing manufacturing facilities in this state by the taxpayer and, in addition, the number of new employees at all new and existing manufacturing facilities in this state shall meet or exceed the limits described in one of the following brackets:
| Amount Invested | Number of New Employees |
| Not less than $1,000,000,000 | Not less than 500 |
| Not less than $900,000,000 | Not less than 600 |
| Not less than $800,000,000 | Not less than 700 |
| Not less than $700,000,000 | Not less than 800 |
| Not less than $600,000,000 | Not less than 900 |
| Not less than $100,000,000 | Not less than 1,000 |
No deduction shall be available under this subdivision (4) until the criteria defined in paragraph a. above, and, in addition, paragraph b. above have been met. The deduction available under this subdivision (4) shall only be available during those years within the 20 years after December 1, 1997, in which the taxpayer maintains the criteria defined in paragraph b. above.
(5) The amount invested by the taxpayer in the purchase of an existing manufacturing facility in this state, which amount shall be limited to the investment in all real and tangible personal property, equipment, facilities, structures, components, and inventory on or after January 1, 1998, and during the period for 20 years thereafter, provided that the taxpayer has met the criteria in paragraphs a., b., and c.
a. The taxpayer must, within six months of February 19, 1998, file with the department a statement of intent to claim the deduction provided pursuant to this subdivision (5). The statement of intent shall contain any information required by the department.
b. At the time of purchase, the existing manufacturing facility must have at least 1,000 employees, which employment level must be maintained during the period 20 years after the date of acquisition by the taxpayer.
c. At the time of purchase, the existing manufacturing facility must produce aluminum alloy can stock.
(6) At the election of the taxpayer,
a. The market value, or current use value if applicable, of the real property as last determined by the county assessing official on which the taxpayer is subject to the tax levied by Chapter 8, or,
b. The book value of the real property.
(7) The book value of personal property subject to the tax levied by Chapter 8.
(8) In the case of an Alabama S corporation, an amount equal to 30 percent of the corporation's taxable income, or, if greater, the amount that would have been the corporation's income tax liability if it were subject to income tax, computed according to the same method used to determine the amounts required to be included in the shareholders' incomes and in accordance with generally accepted accounting principles.
(c) Nothing in this section shall be construed to allow any item to be deducted more than once or to allow a deduction for any item that is excluded from the initial taxable shares base.
Last modified: May 3, 2021