Alabama Storm Shelter Tax Credit
Alabama Emergency Management Agency, in conjunction with the Alabama Department of Revenue, is tasked with administering the provisions of the Alabama Storm Shelter Tax Credit Act.
What is the tax credit?
- The tax credit will equal up to three thousand dollars ($3,000) or 50 percent of the total cost of the construction, acquisition, and installation of the qualified storm shelter at the primary residence, whichever is less.
- The total costs for qualification of the tax credit will exclude any costs reimbursed or expected to be reimbursed by any other reimbursements, grants, or other government subsidies or incentives.
- The tax credit may not decrease a taxpayer’s tax liability to less than zero.
- If the tax liability of the taxpayer is less than the tax credit issued, the taxpayer may only utilize the amount of the credit that reduces the taxpayer liability to zero.
- The statewide tax credit is limited to a collective amount for all taxpayers of two million dollars ($2,000,000) annually.
What storm shelters qualify?
- Shelters installed on/after January 1, 2023.
- The manufacturers of these pre-fab units require a certain amount of time to conduct the proper testing, listing, and labeling of these products in order to comply with the newer FEMA standards {FEMA P-320 (March 2021), FEMA P-361 (April 2021), and ICC 500 (2020) }. FEMA has implemented a “grace period” to allow manufacturers to conduct this work. Therefore, we will accept the design compliant with the previous version (2014 or 2015) to satisfy design standards for a prefabricated safe room up to July 1, 2023. As such the Alabama Emergency Management Agency will accept Individual Safe Rooms’ engineered design drawings that are compliant with FEMA 320 (2014) and ICC 500 (2014) or FEMA 320 (2021) and ICC 500 (2020) may be used to satisfy the requirement for the state tornado shelter tax credit.
Deadline for Submitting Application and Required Documentation
- Failure to submit an application within the same calendar year in which the storm shelter was constructed and/or installed shall disqualify an applicant from consideration. All required documentation must be submitted in order for the application to be deemed complete. The deadline to submit applications is between January 1st and December 31st of the same calendar year in which the storm shelter was constructed and/or installed.
Who qualifies?
- Eligible Alabama state taxpayers who incur costs for the construction, acquisition, or installation of a qualified storm shelter at their primary residence in the state of Alabama will be eligible for an income tax credit for the storm shelter.
What documentation do I need?
- Shelter/safe room specification sheet with engineer seal dated 2021 or later (see above grace period for pre-fab shelters)
- Proof of primary residence (County property tax record)
- Proof of shelter acquisition/installation cost (an invoice with a zero balance)
How do I submit my documents?
Click here to enter the submission portal and submit documentation.
If you would like to verify your storm shelter meets the correct FEMA requirements before purchase of a shelter, you can send your complete set of engineered drawings to sheltertaxcredit@ema.alabama.gov
After you have completed the submission process and received your certificate, retain your certificate until you file your taxes. Provide your certificate with other tax documents to your tax preparer.
For more questions:
For more information on how to apply for the storm shelter tax credit, call 205-921-4555
For more information on how the tax credit will be applied to your taxes, click the link below.
NOTICE Frequently Asked Questions – Storm Shelter Credit (Act 2021-540)