Taxes & Incentives


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ALABAMA JOBS ACT

    • Tax credit of up to 1.5% annually of the qualified capital investment for a qualifying project for up to 10 years.
    • Credit against Alabama income tax liability and/or utility tax liability.
    • Credit can be carried forward for 5 years.
    • Credit may be transferred, or sold, at 85% or more of face value for the first 3 years. Transferability is at the discretion of the Governor.
    • Projects must have a qualifying business activity (Section 40-18-372 of the Code of Alabama, 1975).
    • Projects must create at least 50 net new jobs.
    • Cash rebate of up to 3% annually of the previous year’s gross payroll (not including fringe benefits) for eligible employees for up to 10 years.
    • Up to an additional 0.5% rebate on the wages of veterans for companies employing at least 12% veterans in their eligible workforce.
    • Projects must have a qualifying business activity (Section 40-18-372 of the Code of Alabama, 1975).
    • Projects must create at least 50 net new jobs.

ALABAMA REINVESTMENT & ABATEMENTS ACT

    • Sales & Use Tax Abatement of non-educational portion of sales and use taxes on construction materials, equipment and other capitalized costs.
    • Property Tax Abatement for up to 20 years of the non-educational portion of property tax.
    • Projects must have a qualifying business activity (Section 40-9B-3(a)(10) of the Code of Alabama, 1975).
    • No job creation requirement (exceptions: data centers must create 20 net new jobs; headquarters must create 50 net new jobs).
    • For property tax abatements for years 1 to 10, all property tax is abated at the local level. For years 11 to 20, cities abate city non-educational property taxes, counties abate county non-educational property taxes, and the Governor abates State non-educational property taxes.
    • Sales & Use Tax Abatement of non-educational portion of sales and use taxes on construction materials, equipment and other capitalized costs.
    • Property Tax Abatement for up to 20 years of the non-educational portion of the incremental property tax increases.
    • Projects must have a qualifying business activity (Section 40-9B-3(a)(10) of the Code of Alabama, 1975).
    • No job creation requirement (exceptions: data centers must create 20 net new jobs; headquarters must create 50 net new jobs).
    • For property tax abatements for all years, cities abate city non-educational property taxes, counties abate county non-educational property taxes, and the Governor abates State non-educational property taxes.
    • Associated capital investment must be at least $2,000,000.

ALABAMA RENEWAL ACT

    • One-time tax credit of up to $50 per TEU, $3 per net ton of bulk cargo or $0.04 per net kilogram for air cargo.
    • Credit against Alabama income tax liability.
    • Credit can be carried forward for 5 years.
    • New distribution or warehouse shippers investing at least $20 million and creating at least 75 net new jobs are eligible to receive up to $100 per TEU over a 3-year period if entering into a project agreement with the state.
    • Shipper must use an Alabama public port.
    • Shipper must be engaged in manufacturing, warehousing or distribution of goods.
    • Shipper must increase cargo by at least 5% over the prior year.
    • Credit must be approved by the Renewal of Alabama Commission.
    • Approved projects are funded when taxpayers make contributions to a local economic development organization.
    • Taxpayers receive a tax credit equal to their contributions. The tax credit may offset up to 50% of the taxpayer’s income tax liability.
    • Credit can be carried forward for 5 years.
    • An eligible site must have a deficiency in site preparation or public infrastructure.
    • An eligible site must have either (1) a potential project, or (2) an identifiable reason that an industrial prospect did not select the site in the past.
    • An eligible site must be owned by a local economic development organization, such as an IDA, IDB, chamber of commerce or other nonprofit economic development organization.
    • 25% of the Growing Alabama Funds are earmarked for sites located in Targeted Counties. Projects must be approved by Commerce and the Renewal of Alabama Commission.

ALABAMA FILM INCENTIVES