Alabama Tax Tribunal Directs Revenue Department to Allow Federal Income Tax Deduction

The Alabama Tax Tribunal issued an opinion and preliminary order regarding a final assessment of income tax for 2017. The dispute centered on the Department of Revenue’s requirement for proof of filing a federal income tax return to claim the federal income tax deduction. The taxpayer provided copies of transcripts, cancelled checks, receipts, and a copy of the federal return with a timeline. The Tribunal found that the Department was unaware of any law specifically requiring federal return filing for the deduction and directed the Department to allow the federal income tax deduction and recalculate the final assessment amount accordingly. ...