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, 2022.
  • Shelters that meet FEMA P-320 (March 2021), FEMA P-361 (April 2021) and ICC 500 (2020) standards.
  • 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 standards. FEMA has implemented a “grace period” to allow manufacturers to conduct this work. Therefore we will allow use of the previous editions of the relevant standards (ICC 500-2014 and FEMA P-361 (2015)) for pre-fab safe room units only. This grace period of up to 2 years should allow manufacturers enough time to come into compliance with the newer requirements found in the latest editions of FEMA P-361 and ICC-500. The two year period began with the July 1, 2021 effective date for use of the latest FEMA publications. Therefore, manufacturers will have until July 1, 2023 to come into compliance with the newer criteria.   

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 (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

For more questions:

For more information on how to apply for the storm shelter tax credit, call 205-280-2200

For more information on how the tax credit will be applied to your taxes, click the link below.

https://revenue.alabama.gov/notice-frequently-asked-questions-storm-shelter-credit-act-2021-540/