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Changes to the Alabama Accountability Act

June 29, 2015

Changes have been made recently to the Alabama Accountability Act. Some of the most imminent and noticeable changes affecting donors are discussed below.
  1. A donor is now allowed to select 2014 or 2015 when notifying the department of a donation to a scholarship granting organization (SGO), and reserving a portion of the remaining available tax credit for either year. This option to select a tax year will remain available until October 15, 2015 or until all of the remaining available 2014 credits have been reserved, and verified by the recipient SGOs. A taxpayer who has previously filed the 2014 tax return may make a donation and file an amended tax return to claim the 2014 tax credit. A taxpayer who has not yet filed a 2014 return should show the credit on the original return, which must be filed prior to the extended due date of October 15, 2015.
  2. Effective January 1, 2015 for the 2015 tax year:
  • An increase from $25 million to $30 million in the aggregate allowable annual tax credits.
  • An increase from $7,500 to $50,000 in the annual maximum tax credit available on an individual income tax return.
  • The ability for owners/members of partnerships and S-Corporations to take pro-rata income tax credits for donations made to SGOs by the partnerships and S-Corporations.