A new state tax incentive called The Agricultural Irrigation Systems Tax Credit was signed into law on May 14, which provides farmers who install new irrigation systems or improve existing systems, a one-time tax credit up to 20% of the cost, with a maximum of $10,000 per farm. That’s tax CREDIT, not deduction, so it can be very valuable.

Agriculture/food production is one of the eleven targeted business sectors of the Accelerate Alabama plan, which is the strategic economic development plan developed by the Governor’s office. Clearly, this law is in line with that plan.

Senator Tom Whatley of Auburn, who sponsored the bill said, “The bill was done to help agricultural production, which is the No. 1 industry in Alabama, and it is going to help farmers increase the yield. It’s about helping people who are producing something and contributing to the economy.”

 For more information, please contact a JMF tax adviser.