The Alabama Department of Agriculture & Industries (ADAI) has established an irrigation webpage as a result of House Bill 260 (HB260) that was signed by Governor Kay Ivey back in March of this year.
Section 40-18-342, Code of Alabama 1975, allows for an income tax credit for certain costs for irrigation equipment, fuel conversions, and reservoirs. Pursuant to Section 40-18- 342(g), all agriculture trade or business making qualified costs must file an annual informational report with the ADAIs prior to claiming an income tax credit. Only qualified irrigations systems or reservoirs for which the agriculture trade or business has filed an annual information report with the Department of Agriculture and Industries are eligible for the tax credit. The eligible taxpayer may claim one credit for qualifying equipment purchased and installed during tax years 2012 through 2017, one tax credit for qualifying equipment purchased and installed during tax years 2018 through 2022, and one credit for qualifying equipment purchased and installed during tax year 2023 or thereafter
Producers who performed agriculture irrigation upgrades in 2019 are encouraged to complete the required irrigation questionnaire. Ultimately, the Alabama Department of Revenue (ADOR) will issue the irrigation tax credit to eligible applicants. But, ADAI will be responsible for collecting completed irrigation questionnaires from producers seeking a tax credit in 2019 and consulting with ADOR officials.
The deadline for producers to submit completed questionnaires to ADAI is January 31, 2020. To access the online questionnaire click here.