Tim Russell Elected MTC Vice-Chair

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3rd Quarter FY 2009 (April, May, June 2009) A Quarterly Publication of the Alabama Department of Revenue Tim Russell Elected MTC Vice-Chair he Multistate Tax Commission’s (MTC) Ex - ing federalism and tax fairness through a comprehensive range of activities that in - ecutive Committee elected Alabama Com - cludes: Tmissioner of Revenue Tim Russell to the • Developing recommended uniform state tax policies with respect to interstate post of vice-chair on May 7, 2009. commerce. Russell, who was elected MTC treasurer in 2008, • Encouraging compliance with tax laws and consistency in enforcement was named vice-chair at the MTC’s Spring Execu - through the Joint Audit and National Nexus Programs. tive Meeting, held May 7, 2009, in Alexandria, Va., • Training and education in complex multistate tax issues. • Supporting states engaged in major and “cutting edge” tax litigation through amicus briefs and technical assistance. • Advocacy of State interests in the field of multistate taxation to Congress and the Executive branch. Currently, five ADOR representatives serve on various MTC committees in the areas of uniformity, audit, nexus, and litigation. “I am very honored to have been elected to serve as vice-chair, and I am very proud of the department’s representatives who serve as active participants in their respective MTC committee assignments,” said Russell. “Alabama’s participation in the activities of the MTC has been extremely benefi - cial to Alabama over the years. We have collected tens of millions of dollars through our partnership with the MTC. The MTC’s Joint Audit Program and the National Nexus Program alone have brought millions to the coffers of our state. In addition, the support and legal briefs provided by the Legal Staff of the MTC have been of paramount importance to the success of many of our major tax cases,” Russell added. Forty-six states and the District of Columbia are currently members of the MTC.

ADOR Commissioner Tim Russell filling the vacancy created when Deputy Chief Fi - Sales Tax nancial Officer Stephen M. Cordi, District of Co - lumbia, was appointed chair earlier this year. The Multistate Tax Commission is an intergov - Holiday ernmental state tax agency that works on behalf of For more states aiding in the administration of tax laws that apply to multistate and multinational enterprises. information 2009 The commission, which was created by the Mulit - state Tax Compact in 1967, handles a variety of tax click here initiatives. The MTC works to achieve the goals of preserv - Third Quarter FY 2009 Revenue REVIEW April, May, June 2009

should: waive all penalties; reduce the in - State Revenue Commissioner Tim Russell “Operation Clean terest rate by at least one-half the generally said, “While the final numbers are still being applicable rate; limit the lookback period to compiled, we believe our program here in Slate” Rated High attract nonfilers; not require taxpayers to Alabama was quite successful. The recent admit liability or relinquish appeal rights; article by State Tax Notes helped confirm tate Tax Notes’ contributing writers offer additional benefits not offered in on - our beliefs that we diligently worked to for - Stephen P. Kranz and Jessica L. going voluntary disclosure programs; and mulate the best program for our taxpayers Kerner recently graded the 2009 allow taxpayers currently under audit to to take advantage of and become compliant state tax amnesty programs an - participate in amnesty. with Alabama’s tax laws.” Snounced so far this year in their June 1 arti - After reviewing the various programs’ cle, “Amnesty 101 – Grading the guidelines, they assigned a point value to Landscape.” Alabama’s program, Operation each of their met recommendations for an Clean Slate, which ran Feb. 1 through May effective amnesty program and graded each New Failure to 15, 2009, received top ranking. state’s program based on the total number In their article, the writers compiled of points received. The Alabama program, Pay Penalty their recommendations as to what a suc - according to Kranz and Kerner, scored a cessful amnesty program should entail and total of 16 out of 24 possible points: one reviewed programs, in addition to Ala - point for penalty waiver, five points for lim - Becomes Law bama’s, announced by Arizona, Connecti - ited lookback, five points for no require - cut, Maryland, Massachusetts, New Jersey, ments to admit liability or relinquish appeal ct 2009-144, effective March 24, and Virginia. rights, and five points for being broader 2009, imposes a failure to timely Kranz and Kerner recommended the fol - than the state’s voluntary disclosure pay penalty. This new penalty ap - lowing as components needed to create a program. plies to any tax amount that was successful amnesty program. The program Commenting on Alabama’s ranking, Arequired to be shown on any tax return, if the tax remains unpaid after 30 calendar days from the date the department notifies NOTICE: the taxpayer of the unpaid amount. The ADOR advises that the most com - mon situations where this new penalty Reporting Changes Regarding would be imposed involve tax audits or tax return adjustments. The new late payment Underground/Aboveground penalty would apply to a tax liability deter - mined during an audit or following the ad - Storage Tank Trust Fund Charge justment of a taxpayer’s return, if the tax remains unpaid for over 30 days after the n a notice dated May 21, 2009, the ADOR informed taxpayers that Act 2009-589, taxpayer receives notice that the tax is due. effective May 20, 2009, amended the definition of “motor fuels” to include com - For annual returns with unpaid tax ponents used in any gasoline blend, ethanol, any diesel blend, and biodiesel. As amounts, the new late payment penalty is a result, the Underground and Aboveground Storage Tank Trust Fund Charge is calculated at one percent of the amount of Inow levied on any of these components. tax due per month, or fraction of a month, The Alabama Underground and Aboveground Storage Tank Trust Fund charge is that the tax remains unpaid. The failure to collected by the operator of the bulk facility and is imposed on the first withdrawal pay penalty cannot exceed 25 percent of of a motor fuel from bulk storage in Alabama and on motor fuels imported into Ala - the total amount of tax determined to be bama. The charge is based on invoiced gallons of no less than $.003 per gallon and due. no more than $0.01 per gallon as annually recommended by the Underground and In the case of monthly or quarterly re - Aboveground Storage Tank Trust Fund Management Board. The current rate is $0.01 turns with unpaid tax amounts, the new law per gallon. provides that the failure to timely pay Act 2009-589 also provides for an increase in the current rate up to $0.02 per gal - penalty will be 10 percent of any tax not lon upon recommendation by the Underground and Aboveground Storage Tank paid after 30 days from the date the ADOR Trust Fund Management Board. The fuel charge is earmarked for the Alabama Un - notifies the taxpayer of the liability. derground and Aboveground Trust Fund, administered by the Alabama Department For more information regarding Ala - of Environmental Management. bama’s tax penalties, visit the department’s Web site at www.revenue.alabama.gov . 2 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 County Officials Receive Grants for Mapping epresentatives from Baldwin, Choctaw and Walker counties vis - ited the department in June to re - ceive federal grant money to be uRsed in implementing or upgrading a statewide geographic information system (GIS) used to support property tax adminis - tration functions. Digital orthophotography base mapping is the initial step in GIS. (Far right) Tim Russell, Alabama Commissioner of Revenue, presents Baldwin County’s check for $50,000 to Teddy Qualifications for the grant awards are Faust, Baldwin County Revenue Commissioner-elect; they are joined by (left to right) Bill Bass, ADOR Property Tax based on a county’s commitment to acquire Division Director, and Kenneth McIlwain, Baldwin County Geographic Information Systems Manager. or enhance its GIS technology. The award supplements approximately 40 percent of a county’s budget allocation for orthophotog - raphy; the county is responsible for the re - maining 60 percent funding.

(Far right) Tim Russell, Alabama Commissioner of Revenue, presents Choctaw County’s check for $50,000 to David Sparrow, Choctaw County Revenue Commissioner; they are joined by (left to right) Bill Bass, ADOR Property Tax Division Director, and D’Wayne May, Choctaw County Probate Judge, County Commission Chairman.

(2nd from right) Tim Russell, Alabama Commis - sioner of Revenue, presents Walker County’s check for $35,978 to Jerry Guthrie, Walker County Revenue Commissioner; they are joined by (left to right) Bill Bass, ADOR Property Tax Division Director; Jill Far - rish, Walker County Administrator; Roger Starnes, Walker County Director of Appraisals. 3 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 hydrogen remains at the 30 percent rate, An IRS news release and question-and- but the per-business location limit rises to answer document have more information $200,000. on the net operating loss carryback ISubRmittedSby JohNn Beregerw, editosr, In addition, there are several other en - provision. eNew s ergy credits available that small businesses Technical information is contained in should be aware of, such as: Revenue Procedure 2009-19. merican Recovery and Reinvest - • Residential Energy Property Credit: • Section 179 Deduction ment Act of 2009 Provides En - The new law increases the energy tax credit A qualifying taxpayer can choose to treat ergy Incentives for Businesses for homeowners who make energy efficient A the cost of certain property as an expense The American Recovery and Reinvest - improvements to their existing homes. The and deduct it in the year the property is ment Act of 2009 (ARRA) provides a num - new law increases the credit rate to 30 per - placed in service instead of depreciating it ber of energy tax incentives for both small cent of the cost of all qualifying improve - over several years. This property is fre - and large businesses. Businesses and indi - ments and raises the maximum credit limit quently referred to as section 179 property. viduals who take advantage of these energy- to $1,500 for improvements placed in serv - Under ARRA, qualifying businesses can saving steps this year may result see bigger ice in 2009 and 2010. The credit applies to continue to expense up to $250,000 of sec - tax savings next year. improvements such as adding insulation, tion 179 property for tax years beginning in Here are some of the major provisions energy efficient exterior windows and en - 2009. Without ARRA, the 2009 expensing that apply: ergy-efficient heating and air conditioning limit for section 179 property would have • Extension of Renewable Energy Pro - systems. been $133,000. The $250,000 amount pro - duction Tax Credit: This law extends the • Plug-in Electric Drive Vehicle Credit: vided under the new law is reduced if the “eligibility dates” of a tax credit for business The new law modifies the credit for quali - cost of all section 179 property placed in facilities that use wind, closed-loop bio - fied plug-in electric drive vehicles pur - service by the taxpayer during the tax year mass, open-loop biomass, geothermal en - chased after Dec. 31, 2009. exceeds $800,000. ergy, municipal solid waste, qualified • Plug-In Electric Vehicle Credit: The The new law does not alter the section hydropower and marine and hydrokinetic new law also creates a special tax credit for 179 limitation imposed on sport utility vehi - renewable energy. The “placed in service two types of plug-in vehicles — certain low- cles, which have an expense limit of date” is now Dec. 31, 2012 for wind facilities speed electric vehicles and two- or three- $25,000. and Dec. 31, 2013 for the other facilities. wheeled vehicles. • Election of Investment Credit in Lieu More information on these business en - More Help for Small Business of Production Credit: Businesses that oper - ergy tax incentives are available on IRS.gov The Recovery Act also includes the fol - ate facilities that produce electricity from at www.irs.gov/newsroom/article/0,,id= lowing business-related provisions: wind and some other renewable resources 204335,00.htm . • Reduction of Estimated Tax Pay - after Dec. 31, 2008 can now choose either To keep up with ARRA and other IRS tax ments: Normally, small businesses have to the energy investment tax credit or the pro - news, subscribe to e-News for Small Busi - pay 110 percent of their previous year’s duction tax credit. nesses at http://www.irs.gov/businesses/ taxes in estimated taxes. The Recovery Act • Repeal of Certain Limits on Business small/article/0,,id=154825,00.html or type permits small businesses to reduce their es - Credits for Renewable Energy Property: in “e-News for Small Businesses “ in the timated payments to 90 percent of the pre - ARRA repeals the $4,000 limit on the 30 per - search box on IRS.gov and enter. vious year’s taxes. cent tax credit for small wind energy prop - • Extension of Bonus Depreciation De - erty and the limitation on property financed Key Highlights for Small Businesses ductions Through 2009: Bonus deprecia - by subsidized energy financing for property • Net Operating Loss Carryback tion is extended through 2009, allowing placed in service after Dec. 31, 2008. Small businesses with deductions ex - businesses to take a larger tax deduction • Coordination with Renewable Energy within the first year of a property’s Grants: Business taxpayers can apply for a ceeding their income in 2008 can use a new net operating loss tax provision in ARRA to purchase. grant in lieu of claiming either the energy • Capital Gains Tax Break for Invest - investment tax credit or the renewable en - get a refund of taxes paid over the past five years instead of the usual two. ment in Small Business: Investors in small ergy production tax credit for property business who hold their investments for placed in service in 2009 or 2010. To accommodate the change in tax law, the IRS has updated Publication 536, Net five years can exclude from taxation 75 per - • Temporary Increase in Credit for Al - cent of their capital gains. ternative Fuel Vehicle Refueling Property: Operating Losses (NOLs) for Individuals, Estates and Trusts, as well as the instruc - • COBRA: Health Insurance Continua - Qualified property placed in service in 2009 tion Subsidy: The IRS has extensive guid - and 2010 is now eligible for a 50 percent tions for Form 1045 and Form 1139, which small businesses will use to take advantage ance for employers, including an updated credit, and the per-business location limit Form 941, as well as information for qualify - increases to $50,000. Property relating to of the carryback provision. 4 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 ing individuals. Go to the IRS’s IRS’s American Recovery and Reinvestment Act of 2009 Web site at www.irs.gov/newsroom/article/0,,id=20433 Federal Refund Offset Fee 5,00.html for information and links to each of these provisions. Now to Be Paid by Debtor Subscribe to e-News for Small Busi - nesses at http://www.irs.gov/businesses/ new state law requires the administrative fee charged by the U.S. Treasury small/article/0,,id=154825,00.html to get Department for Alabama’s participation in the Treasury Offset Program the latest information about ARRA and (TOP), a debt collection program, to be paid by Alabama taxpayers whose other IRS news and information. federal refunds are intercepted for payment of past-due Alabama income tAax debts. Prior to passage of Act 2009-223, effective April 8, 2009, the Alabama Department Administrative of Revenue (ADOR) was required to pay the federal fee to the U.S. Treasury for each federal refund intercepted and applied to past-due Alabama income tax debts. The federal fee is set at $22 per federal refund offset. Rules Alabama has participated in the Federal Refund Offset program since 2003 and has collected over $37.5 million, representing 153,664 federal refund offsets. Effective May 20, 2009 Federal legislation passed by Congress in 1998 (P.L. 105-206) authorizes the fed - Adopted: eral government to offset federal tax refunds to satisfy state tax delinquencies. Forty- 810-8-1-.18 Procedure for Issuing Re - one states, including the District of Columbia, currently participate in the federal fund of Gasoline and Motor Fuel Ex - Treasury Offset Program. cise Taxes for Agricultural Purposes and for the Delivery of Biomass Products Repealed: Interest Rates Remain the 810-5-41-.07 Salvage-Motorcycles, Semi- trailers, etc. Procedure on Vehicles Same for Third Quarter that do not have Vehicle Identifica - tion Number Plates to be Removed when Total Loss Occurs nterest rates for the calendar quarter beginning July 1, 2009, remained the same (4% Effective June 5, 2009: a.p.r.) for underpayments, according to the Internal Revenue Service’s Bulletin No. Amended: I2009-26. 810-5-26-.02 Powers of the Department- Under Sect. 40-1-44, Code of Alabama 1975 , the Department of Revenue will calculate Revocation and Denial of Authority interest on underpayments and overpayments (where applicable) at this same annual rate to Act as Designated Agent of the (4 %); however, land sold by the state for taxes, shall be calculated at 12% in accordance Department with Sect. 40-5-9. (Historical rates shown below.) Effective July 17, 2009: Adopted: 810-3-15-.27 Deductions for Contribu - Interest Rates By Calendar Quarter tions to Alabama College Education (Established by: 26 USCA §6621; §40-1-44, Code of Alabama 1975 ) Plans Effective Aug. 4, 2009: 1ST QTR 2ND QTR 3RD QTR 4TH QTR Amended: 2001 9% 8% 7% 7% 810-6-3-.32 Historical Preservation 2002 6% 6% 6% 6% Authorities 2003 5% 5% 5% 4% 810-6-3-.33 Industrial Development 2004 4% 5% 4% 5% Board 2005 5% 6% 6% 7% 810-6-3-.38 Medical Clinic Boards 2006 7% 7% 8% 8% 810-6-3-.41 Exemption for Municipal Special Health Care Facilities 2007 8% 8% 8% 8% 810-6-3-.41.01 Exemption for Certain 2008 7% 6% 5% 6% Health Care Authorities 2009 5% 4% 4% 5 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 2009 Revenue-related Legislation General Legislation fund was intercepted. ADOR may prepay for the expenses of its Effective date: April 08, 2009 employees traveling out of state. No trav - Act 2009-144 (HB 69) – Entertainment eler will have prepaid expenses in excess of Act 2009-281 (HB 316) – Alabama De - Industry Incentive Act of 2009 $4,000 for any one period of travel, nor will partment of Revenue has the au - This bill exempts certain sales, use and prepaid expenses exceed a total of $20,000 thority to issue and transfer lodging taxes, and provides refundable for all travelers at any time. certificates of title electronically credits against the income tax liabilities of Effective date: May 14, 2009 qualified production companies to encour - This bill provides ADOR with the author - age growth within the entertainment indus - ity to promulgate rules to issue and transfer Act 2009-503 (HB 29) – Authorizes try. The bill also requires the filing of certificates of title electronically; changes agents of the Alabama Department composite returns for nonresident partners title exemption and inspection require - of Revenue to seize illegal or members of “pass-through” entities; and ments; specifies parties required to sign cigarettes provides income tax exemptions for non - title applications; provides ADOR with the This bill authorizes ADOR agents to resident partners of qualified investment authority to record and release security in - seize any brand of cigarettes that are sold, partnerships. It also expands and clarifies terests electronically. possessed for sale, or imported for personal penalties for failure to pay tax as required. Effective date: July 01, 2009 consumption in this state without being listed in the Directory of Cigarettes Ap - Effective date: Retroactively to January Act 2009-337 (HB 590) – Development proved for Stamping or Sale in Alabama. 1, 2009, for purposes of qualifying for re - of closed federal military installa - Effective date: May 14, 2009 bates, and sales, use, and lodging tax ex - tions in Alabama emptions. The composite return This bill authorizes the incorporation of Act 2009-508 (SB 142) – Redemption requirements and the exemption for quali - development authorities for the purpose of of property sold for delinquent fied investment partnerships are effective developing real and personal property of taxes – provides further for rights for all tax years beginning after December closed federal military installations in Ala - of the purchaser 31, 2008. The penalty provisions are bama; exempts authorities from certain This bill concerns the redemption of effective immediately. taxes and from usury and interest laws; pro - property sold for delinquent ad valorem Act 2009-147 (HB 382) – Establishes vides an exemption from certain public taxes; further defines the term residential severance taxes for offshore oil and lands sales requirements. property; allows tax status to remain for gas based on the gross proceeds Effective date: April 30, 2009 Class III owner-occupied property; requires ad valorem taxes to be paid before the from the sale of the oil or natural Act 2009-461 (SB 373) – Authorizes judge of probate issues a deed upon the ex - gas Lifeline and Link-Up telephone piration of three years from the date of sale This bill establishes that severance taxes services to low income residential of any real estate for taxes and provides fur - for certain offshore oil and gas produced customers ther for the deposit of redemption money; for sale, transport, storage, profit or use will This bill provides further for the regula - provides further for the purchaser's rights be based on the gross proceeds from the tion of telephone services by the Public where the tax sale proceedings were defec - sale of the oil or natural gas. Service Commission and further authorizes tive, for actions for possession and defenses Effective date: Effective for oil and gas Lifeline and Link-Up services to low income that are defeated on grounds other than produced on or after May 01, 2009. All oil residential customers. Alabama Depart - that the taxes were not due, for the tender and gas produced prior to the effective ment of Revenue will support efforts to pro - of parties claiming adversely to the tax title, date shall be subject to the laws in effect mote Lifeline participation by including for the effect of payment by the original prior to the effective date. information regarding Lifeline eligibility and owner, and for the time and by whom the enrollment within individual state income Act 2009-223 (HB 497) – Federal Off - land may be redeemed. tax instruction booklets. set Program of Federal Income Tax Effective date: September 1, 2009 Refunds (TOPS) Effective date: August 1, 2009 Act 2009-513 (HB 222) – Adds Title This bill provides that the fee charged by Act 2009-499 (SB 107) – Increases pre - 10A, the Alabama Business and the United States Department of Treasury paid traveling expenses for Alabama Nonprofit Entities Code for state participation in the federal offset Department of Revenue employees This bill adds Title 10A to the Code of program of federal income tax refunds shall This bill increases the amounts that be paid by the taxpayer whose federal re - Alabama 1975 ; entitled the Alabama Busi - 6 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 ness and Nonprofit Entities Code, com - workers; grants the 21st Century Authority Act 2009-620 (SB 84) – Practice privi - prised of chapters concerning general pro - the power to establish the Alabama Con - lege for nonresident CPAs visions; the Alabama Business Corporation struction Recruitment Institute. This bill provides for a practice privilege Law; the Alabama Professional Corporation Effective date: May 18, 2009; contingent for nonresident certified public account - Law; the Alabama Limited Liability Company upon passage of HB 700 ants; makes certain technical changes; con - Law; the Alabama General Partnership Law; forms state law to certain federal auditing Act 2009-568 (HB 71) – Authorizes the the Alabama Real Estate Investment Trust standards; increases certain administrative sale of admission tickets at a price Law; the Alabama Employee Cooperative fines. greater than the original price Corporations Law; business trusts; and the Effective date: October 1, 2009 This bill allows admission tickets to be Alabama Unincorporated Nonprofit Associa - sold at a price greater than the original Act 2009-621 (SB 87) – Alabama Uni - tion Law. price, and provides penalties for the sale of form Limited Partnership Act of Effective date: January 1, 2011 counterfeit tickets. 2010 Act 2009-549 (HB 868) – Hospital Effective date: August 1, 2009 Adds Chapter 9C of Title 10 to the Code funding program for the Alabama of Alabama 1975 , entitled “Alabama Uni - Act 2009-583 (HB 445) – Heavy equip - Medicaid Program form Limited Partnership Act of 2010”; es - ment rental companies may include This bill provides for an assessment on tablishes rights, liabilities, and rules for recovery fee in rental agreements privately operated hospitals in Alabama as a registration of limited partnerships. This bill provides that companies rent - funding program for the Alabama Medicaid Effective date: January 1, 2010 ing heavy equipment property located in Program, and creates a Hospital Assessment Alabama may include a one and one-half Act 2009-623 (SB 212) – Operation Account in the Health Care Trust Fund. percent recovery fee on the gross rental re - Iraqi Freedom and Operation En - The program terminates on September 30, ceipts from any item of heavy equipment during Freedom-Afghanistan Vet - 2011. rented by a customer; recovery fee to be re - eran Plate Effective date: May 15, 2009. Expires tained by the business and used to pay per - This bill provides for the issuance of an September 30, 2011. Article automatically sonal property taxes; the recovery fee Operation Iraqi Freedom and an Operation terminates and becomes null and void on doesn't apply to the leasing or renting of Enduring Freedom-Afghanistan Veteran September 30, 2011, unless later bill is heavy equipment to the State of Alabama, Plate; provides for the fee and distribution passed extending the article to future state any municipality, or any county. of fee. fiscal years. Effective date: May 20, 2009 Effective date: August 1, 2009 Act 2009-561 (HB 700) – Provides for Act 2009-595 (HB 715) – Alabama Act 2009-630 (SB 311) – Establishes levy of fees upon employers based Gold Star Family license plate and supports reduced cigarette ig - upon the Alabama wages paid to This bill establishes a new distinctive li - nition propensity standards; and es - construction workers cense plate category entitled “Alabama Gold tablishes civil penalties for This bill levies fees based upon the Ala - Star Family.” Any member of the immediate violations bama wages paid to certain skilled con - family of a person who died while on active This bill establishes and supports re - struction workers under a construction duty of any branch of the US military may duced cigarette ignition propensity stan - contract or job located in this state; funds a apply to the judge of probate or other dards, and establishes civil penalties for program to provide for the recruitment of, county license plate issuing official, present violations. The Alabama Department of and the promotion of training programs proper documentation, pay required motor Revenue, while conducting inspections of and opportunities for, new construction vehicle license fees and taxes, and pay an wholesale dealers, agents, and retail deal - craft trade workers; provides for remittance additional fee of $3.00 for the initial is - ers, may inspect cigarettes to determine if of fees to the state 21st Century Authority suance of this tag. the cigarettes are marked as required by for the benefit of the Alabama Construction Effective date: January 1, 2010 this act; and will notify the State Fire Mar - Recruitment Institute. shal of any violations. ADOR, along with Effective date: May 18, 2009; contingent Act 2009-618 (SB 54) – Volunteer fire - the Attorney General, the State Fire Mar - upon passage of SB 301. Expires and fighters exempted from paying li - shal, their duly authorized representatives, repealed May 18, 2013 (four years after ef - cense taxes and registration fees and other law enforcement personnel, is fective date) This bill exempts certain volunteer fire - authorized to examine the books, papers, fighters from the payment of certain license Act 2009-563 (SB 301) – Promotes re - invoices, and other records of any person in taxes and registration fees on motor cruiting and training programs for possession, control, or occupancy of any vehicles. construction craft trade workers premises where cigarettes are placed, Effective date: August 1, 2009 This bill promotes recruiting and train - stored, sold, or offered for sale, as well as ing programs for construction craft trade the stock of cigarettes on the premises. 7 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 Effective date: January 1, 2010; pro - and local gasoline and diesel fuel taxes; and such properties; authorizes the release of vided subsection (a) of Section 7 and Sec - exempts these squads from all tax and certain tax liens in order to facilitate the de - tion 12 shall become effective immediately motor vehicle license fees on motor velopment of certain tax delinquent proper - following its passage and approval by the vehicles. ties; creates a board to govern the land Governor, or its otherwise becoming law Effective date: August 1, 2009 bank authority. This act shall not apply to (May 21, 2009). property owned, operated, or used by utili - Act 2009-717 (HB 519) – Exempts vol - ties engaged in the generation, transmis - Act 2009-637 (HB 28) – U.S. Marine unteer fire departments from state sion, or distribution of electricity. Corps distinctive license plate and local gasoline and diesel fuel Effective date: August 1, 2009. This bill establishes a new distinctive li - taxes cense plate category for the U.S. Marine This bill exempts vehicles owned and Act 2009-743 (SB 105) – Spouses of el - Corps; provides an additional $3.00 fee for operated by volunteer fire departments and igible retired military members and active corps members in the year the li - fire protection districts from state and local eligible retired reservists will re - cense plate is issued, and an annual addi - gasoline and diesel fuel taxes. ceive one distinctive motor vehicle tional fee of $25.00 for retirees and Effective date: August 1, 2009 tag designated for retired members honorably discharged corps members; and of the USAF Act 2009-722 (HB 568) – Allows addi - provides that the proceeds from the annual This bill provides for spouses of eligible tional categories of industries to be additional fees will be distributed to the De - retired military members and eligible re - eligible for Alabama's existing partment of Alabama Marine Corps League. tired reservists to receive one distinctive incentives Effective date: January 1, 2010 motor vehicle tag designated for retired This bill expands the categories of busi - members of the U.S. Armed Forces upon Act 2009-639 (HB 58) – Vietnam veter - nesses eligible for Alabama’s existing incen - payment of license and registration fees; ans pay additional tag fee for each tives to new or expanding businesses provides that upon the death of any retired year registration is renewed incentives, including corporate headquar - military license plate recipient, the surviv - This bill provides that Vietnam veterans ters, data processing centers, research and ing spouse will retain the distinctive license will pay an additional $3.00 tag fee for each development facilities, producers of elec - plate upon one motor vehicle owned by the year the registration is renewed; provides tricity or natural gas from renewable energy surviving spouse for the remainder of the that the fees will be distributed to the Viet - resources or biofuels, and biofuel produc - spouse's lifetime or until remarriage. nam Veterans of America, Inc., Alabama ers. It also increases the base wage require - Effective date: August 1, 2009 State Council. ment for qualifying projects. Effective date: August 19, 2009 (90 days Effective date: May 21, 2009. This act Act 2009-746 (SB 151) – Alabama Man - following its enactment date of May 21, does not repeal or amend the effective date ufactured Home Certificate of Title 2009) for projects first authorized by Act 2008- Act 275. The provisions of this act shall be ef - This bill establishes title law specifically Act 2009-644 (HB 130) – Increases tag fective and shall apply for projects for manufactured homes; removes manu - fee for Fraternal Order of Police li - authorized in this act that are first placed factured homes from the Alabama Uniform cense tags; authorizes distinctive li - in service on or after the effective date of Certificate of Title and Anti-theft Act and es - cense tags for motorcycles owned this act. tablishes a new chapter for titling manufac - by FOP members tured homes and cancelling certificates of This bill increases the annual additional Act 2009-731 (HB 807) – Income tax title when a manufactured home is perma - fee for a Fraternal Order of Police distinc - refund check-off for Alabama Mili - nently affixed to real property. The bill also tive license tag to $30.00 and authorizes dis - tary Support Foundation exempts utility trailers and certain vehicles tinctive license tags for motorcycles owned This bill provides an income tax refund already titled out of state from having to be by members of the Fraternal Order of Police check-off for a contribution to the Alabama titled in Alabama before they are registered. under certain conditions; and provides for Military Support Foundation, Incorporated; Finally, the bill requires that vehicles not distribution of the fee. applies to each Alabama state income tax subject to titling be physically inspected by Effective date: August 1, 2009 return for the 2009 tax year and each year the licensing official prior to first registra - thereafter. Act 2009-660 (HB 315) – Exempts Ala - tion in Alabama. Effective date: August 1, 2009 bama Association of Rescue Squads Effective date: January 1, 2010 from state and local gasoline and Act 2009-738 (SB 19) – Alabama Land Act 2009-779 (HB 808) – Amends the diesel fuel taxes Bank Authority Alabama Scrap Tire Environmental This bill exempts rescue squads who are This bill creates the Alabama Land Bank Quality Act members in good standing of the Alabama Authority for the purpose of acquiring tax This bill amends the Alabama Scrap Tire Association of Rescue Squads from state delinquent properties for rehabilitation of Environmental Quality Act; defines terms, 8 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 accumulation and expansion of limits, Act 2009-286 (HB 242) – Prohibition Dothan; provides for the collection of the cleanups, receivers, transportation of scrap in Amendment 778, now appearing tax; provides for the distribution of the tax tires, manifests, financial assurance, admin - as Section 269.08 in the Constitu - proceeds. istration and enforcement, and the distribu - tion of Alabama, applies only to Effective date: August 1, 2009 tion of environmental fee proceeds; levy and collection of additional ad Act 2009-361 (HB 641) – Reallocates a provides for criminal penalties for viola - valorem taxes levied specifically portion of TVA payments received tions. This bill changes the discount that under provisions of Amendment by Morgan County Commission to the tire dealer receives when he pays the 778 the Morgan County Rescue Squad scrap tire environmental fees from 5% to This constitutional amendment provides This bill reallocates to the Morgan 7%, thereby decreasing the amount of that the prohibition in Amendment 778, County Rescue Squad a portion of the addi - money that would be deposited in the now appearing as Section 269.08 in the tional TVA in-lieu-of-taxes payment received Scrap Tire Fund. Constitution of Alabama, against the pay - by the county commission. Effective date: August 1, 2009 ment of any fees, charges, or commissions Effective date: May 5, 2009 for the assessment or collection of any new Act 2009-787 (HB 931) – Alabama Cap - taxes levied in order to comply with the Act 2009-368 (HB 761) – Increases ital Assistance Stimulus for Rail provisions of Amendment 778, applies only rate of ad valorem tax in Ozark Projects Act of 2009 to levy and collection of additional ad val - This bill authorizes the city council of This bill establishes the Alabama Capital orem taxes levied specifically under provi - Ozark, in Dale County, to increase the rate Assistance Stimulus for Rail Projects Act of sions of Amendment 778 and does not of ad valorem tax, and provides for a 2009; requires the Alabama Department of apply to any prior or future levy set by or referendum. Economic and Community Affairs (ADECA), renewed under the laws or constitution of Effective date: Contingent upon voter with the assistance of the Mississippi- the state. approval Louisiana-Alabama Rapid Rail Transit Com - Effective date: Contingent upon voter mission, to establish and operate a program Act 2009-379 (HB 820) – Increases approval to promote passenger rail travel and serv - lodgings tax in Covington County ice; develops the state rail plan; provides Act 2009-329 (HB 668) – Lee County This bill increases the amount of the for funding. Commission may levy additional lodgings tax in Covington County and pro - Effective date: July 1, 2009 sales and use tax outside corporate vides for the distribution of the tax limits of Auburn, Opelika, Phenix proceeds. Local Legislation City, and Smiths Station Effective date: May 5, 2009 This bill authorizes the Lee County Act 2009-152 (SB 179) – Lawrence Act 2009-476 (HB 467) – Amends “The Commission to levy an additional sales and County Community Development Greater Montgomery Act” use tax outside the corporate limits of Commission This bill amends Act 386, 1978 Regular Auburn, Opelika, Phenix City, and Smiths This bill creates the Lawrence County Session, cited as “The Greater Montgomery Station; provides for collection, distribu - Development Commission; provides for Act”; provides for the assessment for ad val - tion, and use of the tax proceeds; provides membership of the commission; establishes orem taxation by the City of Montgomery for the enforcement of the act, and its a Community Development Fund within and the maintenance of roads and streets in referendum. the county treasury, and provides for the areas that have been annexed by the City of Effective date: Contingent upon voter source of revenue. Montgomery pursuant to Act 386. approval Effective date: June 1, 2009 Effective date: May 13, 2009 Act 2009-340 (SB 49) – Distribution of Act 2009-285 (HB 620) – Cullman Act 2009-477 (HB 591) – System of in - Jackson County's gasoline tax County Community Development dexing documents affecting prop - This bill provides further for the distri - Commission erty titles in DeKalb County's Judge bution of the gasoline tax in Jackson This bill creates the Cullman County of Probate Office County; expenditures provided for in Sec - Community Development Commission; es - This bill requires the installation of an tion 12 shall be made exclusively for road tablishes a Community Development Fund improved system of indexing documents af - materials only. within the county treasury, and provides for fecting the title to property and other docu - Effective date: May 5, 2009 the source of revenue; ratifies and confirms ments recorded in the office of Judge of certain payments made before the effective Act 2009-350 (HB 387) – Levies lodg - Probate in DeKalb County. date of this act; distributes the proceeds of ings tax in Houston County outside Effective date: May 13, 2009 certain alcoholic beverage funds received the corporate limits of Dothan by the county. This bill levies a lodgings tax in Houston Effective date: April 21, 2009 County outside the corporate limits of 9 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 Act 2009-494 (SB 566) – Distribution Effective date: Contingent upon voter ties of the authority; provides for the em - of TVA payments in DeKalb County approval ployees of the authority. This bill provides further for the distri - Effective date: May 22, 2009 Act 2009-567 (HB 37) – Social Security bution of the share of in-lieu-of-taxes pay - number or birth date removed from Act 2009-767 (SB 637) – Distribution ments from the TVA to DeKalb County. certain documents recorded with of TVA payments in Morgan County Effective date: August 1, 2009 probate office This bill reenacts and amends Act 2007- Act 2009-497 (SB 586) – Creates This bill requires that a person recording 339, of the 2007 Regular Session, to provide Etowah County Tourism Board certain documents with the probate office further for the distribution of TVA in-lieu-of- This bill creates the Etowah County redact, remove, or otherwise make illegible taxes payments in Morgan County. Tourism Board; distributes certain lodging a Social Security number or birth date ap - Effective date: May 22, 2009 taxes to the board. pearing on the documents under certain Act 2009-785 (HB 961) – Coosa River Effective date: May 14, 2009 conditions; authorizes the judge of probate Valley Recreation Board to make certain records available to the Act 2009-510 (SB 90) – Alabama Uni - This bill establishes the Coosa River Val - public in electronic format and to publish form Real Property Electronic ley Recreation Board in Talladega County; certain records on the Internet. Recording Act the board will manage, control, regulate, Effective date: May 20, 2009 This bill adopts the Alabama Uniform and maintain certain property in the county. Real Property Electronic Recording Act; Act 2009-594 (HB 669) – Increases Effective date: May 22, 2009 provides standards for electronic filing of special recording fee collected by Act 2009-786 (HB 928) – Levies an in - real property documents and signatures on judge of probate in Chilton County creased fire protection service fee documents; provides for the validity of elec - This bill increases the special recording in Colbert County tronic documents; provides for the compli - fee collected by the judge of probate for in - This bill provides for the levy of an in - ance with standards adopted by the struments and documents filed for record creased fire protection service fee on Electronic Recording Commission. in the probate office of Chilton County. dwellings outside the corporate limits of Effective date: January 1, 2010 Effective date: August 1, 2009 Tuscumbia, Sheffield, and Muscle Shoals, in Act 2009-545 (HB 742) – Constitu - Act 2009-599 (HB 793) – Marshall Colbert County. The bill also provides for a tional amendment extending length County Commission may impose an levy of the fee on each business or commer - of time for person claiming home - annual motor vehicle tag fee on cer - cial building or facility in the area; proceeds stead exemption in Jefferson tain municipalities will fund volunteer fire departments. County by three years after he/she This bill authorizes the Marshall County Effective date: Contingent on voter is admitted to nursing home or as - Commission to impose a motor vehicle tag approval sisted living facility fee to be levied and collected annually on Act 2009-791 (HB 784) – Exempts cer - This constitutional amendment allows a each motor vehicle registered outside the tain districts in Jefferson County person residing in Jefferson County and corporate limits of any city having a city from privilege or license taxes or claiming a homestead exemption in the board of education, and the Cities of Arab, excise tax on gasoline or motor county to continue to claim the homestead Boaz only within Marshall County, and Gun - fuels exemption for three years after he/she is tersville; proceeds to be used for public This bill amends Act 79, 1966 Special admitted to a nursing home or assisted liv - school and education purposes. Session, to exempt Jefferson County dis - ing facility. The extension is allowed only if Effective date: August 1, 2009 tricts, for fighting fires, emergency medical the property continues to be used for resi - Act 2009-736 (HB 925) – Levies lodg - services, and for the disposal of garbage, dential purposes and the property is not ings tax in Lowndes County from any privilege or license taxes or excise converted to commercial or other purpose. This bill authorizes the levy of a lodgings tax on gasoline or motor fuels. Effective date: Contingent upon voter tax in Lowndes County; provides for the Effective date: May 22, 2009 approval collection of the tax and the distribution of Act 2009-551 (HB 253) – Special the proceeds. county educational taxes may be Effective date: May 21, 2009 levied by a majority vote Act 2009-764 (SB 613) – Montgomery This bill amends Section 269 of the Ala - I-65 Corridor Development bama Constitution; provides that special Authority county educational taxes may be levied by a This bill establishes the Montgomery majority vote, not by three-fifths vote, of I-65 Corridor Development Authority; pro - those voting at the election. vides for the membership, powers, and du - 10 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009 Tax Calendar • Underground and aboveground storage tank trust Required Monthly Returns Tax Activity fund charge due. • Use tax return and payment due. Utility gross receipts tax return and payment due. 10th • Medicaid-related tax return and payment • due for nursing facilities. • Tobacco use tax return and payment due. 30th • Hazardous waste fee return and payment due. 15th • Gasoline information return due from Last day carriers, transporters, and warehouses. of month • State horse wagering fee return and pay - Lubricating oils information return due from carriers, • ment due. transporters, and warehouses. • Motor carrier mileage tax return and payment due. • Oil and gas production tax and privilege tax return Quarterly/Annual Tax Activity and payment due two months following month of (August-December 2009) production. September 17th • Withholding return and payment due from those employers required to remit on a monthly basis 15 • Third installment of estimated corporate in - come tax due (for calendar-year taxpayers). • Third installment of estimated personal income tax Aviation fuel tax return and payment due. 20th • due. • Coal severance tax return and payment due. • Coal transporters’ and purchasers’ returns due. 25 • Hydroelectric gross receipts return and pay - • Contractors’ gross receipts tax return and payment ment due. due. • Gasoline tax return and payment due. October • Iron ore severance tax return and payment due. • Local solid minerals tax returns and payments due. 1 • Property tax on real and personal property due. • Lodgings tax return and payment due. • Automotive dismantlers and parts recyclers license • Lubricating oils tax return and payment due. due. • Medicaid tax return and payment due from pharma - • Business privilege license fee due. ceutical service providers. • Quarterly Dry Cleaning Trust Fund Fee return and • Mobile telecommunications tax return and payment payment due. due. • Manufactured home registration and fee due. • Motor fuel tax return and payment due. • Motor fuel identification markers issued. • Natural minerals severance tax return and payment • Motor vehicle dealers, reconditioners, rebuilders and due. wholesalers license tax due. • Pari-mutuel pool tax return and payment due. • Store and chain store license tax due. • Rental or leasing tax return and payment due. • Utility license (2.2%) return and first quarterly pay - • Sales tax (state and local) return and payment due. ment due. • Scrap Tire Environmental Fee due. • Tobacco tax (state and county) return and payment (Continued on Page 12) due. 11 Third Quarter FY 2009 Revenue REVIEW April, May, June 2009

• Quarterly payroll fee and return due. ADOR Notifies 14 • Annual wholesale oil li - *New state fee, effective July 1, cense return and payment due. 2009, applied to construction Construction craft trade job payrolls. 20 • Quarterly sales tax return Industry and payment due. November • Quarterly use tax return and Employers of New payment due. 30 • Last day to register and • Quarterly rental or leasing tax pay fee for manufactured homes Payroll Fee Aimed return and payment due. without penalty. • Quarterly Solid Waste Disposal to Promote Craft Fee return and payment due. December Trade Jobs 30 • Forest products severance 15 • Fourth installment of esti - tax return and payment due. mated corporate income tax due he Alabama Department of Rev - (for calendar-year taxpayers). enue (ADOR) recently notified all 31 • Quarterly withholding re - Alabama contractors, subcontrac - turn and payment due from 31 • Property tax on real and tors, and general contractors of personal property delinquent rTecord to inform them of a new state fee employer. after this date. • Quarterly IFTA tax return and that applies to construction craft trade job • Last day to claim exemptions/ payment due. payrolls, effective July 1, 2009. abatements on property tax The new fee, authorized by Act 2009-561 Annual business privilege li - • assessments. and approved by the Legislature during the censes delinquent after this date. • Expiration of the previous calen - 2009 session, applies to construction indus - • Store and chain store licenses dar year’s motor fuel identifica - try employers who employ skilled construc - delinquent after this date. tion markers. tion workers directly engaged in commercial and industrial construction op - erations located in Alabama. Statement of Gross Tax Collections The ADOR advises that the fee does not apply to residential home building Through End of 3rd Quarter FY 2009 or any residential project. (April, May, June 2009) The fee is set at $90 per $100,000 of af - fected construction job payroll and is remit - FYTD 2008-2009 FYTD 2007-2008 % Change ted to the Alabama Department of Revenue Business Privilege Tax $ 99,557,743.16 $ 89,870,098.26 10.78 on a quarterly basis. The first return and Gasoline 297,256,979.68 301,436,083.50 (1.39) fee payment are due Oct. 31, 2009, and are Income Tax-Corporate 391,332,161.73 440,923,842.34 (11.25) required to be remitted electronically to the Income Tax-Individual 2,593,075,322.07 2,824,975,355.59 (8.21) ADOR. Collections from the fee are earmarked Income Tax (Total) 2,984,407,483.80 3,265,899,197.93 (8.62) for the Alabama 21st Century Authority to Motor Fuels 88,168,765.71 102,098,010.15 (13.64) the credit of the Recruitment and Training Oil & Gas Privilege (8%) 65,269,793.78 90,887,246.25 (28.19) Promotion Fund for the purpose of funding Oil & Gas Production (2%) 27,044,879.82 36,424,569.38 (25.75) a recruitment and training promotion pro - Sales 1,374,736,982.41 1,511,793,068.71 (9.07) gram aimed at identifying and attracting in - Use Tax 191,387,242.08 205,035,278.55 (6.66) dividuals to construction craft trades. For more information concerning em - Utility Gross Receipts 318,963,109.28 310,484,408.28 2.73 ployers’ filing requirements, taxpayers may SUBTOTAL 5,446,792,979.72 5,913,927,961.01 (7.90) contact the ADOR at 334.242.1300 or visit SUBTOTAL (OTHER TAXES) 1,023,898,993.24 981,881,580.57 4.28 the department’s Web site at www.revenue.alabama.gov . TOTAL (ALL TAXES) $6,470,691,972.96 $6,895,809,541.58 (6.16)