Alabama § 40-18-312 - Distributions from Catastrophe Savings Account; Additional Tax.
Full text of Alabama Code of Alabama § 40-18-312 — Distributions from Catastrophe Savings Account; Additional Tax., with citation guidance and answers to common questions.
§ 40-18-312. Distributions from Catastrophe Savings Account; Additional Tax.
(a) A distribution from a catastrophe savings account must be included in the income of the taxpayer unless the amount of the distribution is used to cover qualified catastrophe expenses.
(b) No amount is included in income, pursuant to subsection (a), if the qualified catastrophe expenses of the taxpayer during the taxable year are equal to or greater than the aggregate distributions during the taxable year.
(c) If aggregate distributions exceed the qualified catastrophe expenses during the taxable year, the amount otherwise included in income must be reduced by the amount of the distributions for qualified catastrophe expenses.
(d)(1) The tax paid pursuant to Section 40-18-5 attributable to a taxable distribution must be increased by two and one-half percent of the amount that is includable in income.
(2) This additional tax does not apply if any of the following occur:
a. The taxpayer no longer owns a residential property that qualifies pursuant to Chapter 7.
b. The distribution is from an account conforming with Section 40-18-311(c)(3) and is made on or after the date on which the taxpayer attains the age of 70.
(e) If a taxpayer who owns a catastrophe savings account dies, his or her account is included in the income of the person who receives the account, unless that person is the surviving spouse of the taxpayer. Upon the death of the surviving spouse, the account is included in the income of the person who receives the account. The additional tax in subsection (d) does not apply to distribution on death of the taxpayer or the surviving spouse.
(f) The provisions of Act 2026-100 apply to tax years beginning on or after January 1, 2027.
Source: official Alabama text · Last verified 2026-08-27
Frequently Asked Questions About Alabama § 40-18-312
What does Code of Alabama § 40-18-312 cover?
Section 40-18-312 ("Distributions from Catastrophe Savings Account; Additional Tax.") is part of the Code of Alabama, the codified statutory law of Alabama. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Alabama § 40-18-312?
A common citation format is "Code of Alabama § 40-18-312" (Alabama). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Alabama law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Alabama official source linked on this page or consult a licensed Alabama attorney.
How does Alabama § 40-18-312 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Alabama can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Alabama.