Alabama Tax Incentives
Biofuel Production Facility Tax Credit
Companies that invest in the development of a biofuel production facility may be eligible for a tax credit against the state income tax or financial institution excise tax liability generated by the project each year for up to 20 years in the amount equal to 5% of the capital costs of the project. For the purposes of the credit, biofuel is defined as a motor vehicle fuel that is produced from grain, starch, oilseeds, vegetable, algae, animal, or fish materials including fats, greases and oils, sugarcane, sugar beets, sugar components, tobacco, potatoes, and lignocellulosic or other biomass. In order to be eligible for the tax credit, the capital costs of the production facility must be at least $2,000,000 if the facility is not located in a favored geographic area, and $500,000 if the facility is located in a favored geographic area. A favored geographic area is defined as an area or county that is designated as an enterprise zone or is considered to be less developed by the Alabama Department of Industrial Relations. (Reference House Bill 568, 2009)
