# Ala. Code § 40-16-1.1: Section 40-16-1.1 Taxation of Trust as Financial Institution

> Alabama · Statutes · In force

URL: https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-1.1

## Section

- **Citation:** Ala. Code § 40-16-1.1
- **Heading:** Section 40-16-1.1 Taxation of Trust as Financial Institution
- **Jurisdiction:** Alabama
- **Kind:** Statutes
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Alabama Code / Title 40 / Chapter 16 / Section 40-16-1.1

## Text

(a) For purposes of this section, “trust” shall have the same meaning given to it in Section 40-18-1.

(b) Any trust which would be subject to tax under Chapter 18 but which also is a financial institution shall be taxed as a financial institution under this chapter, applying the applicable provisions of subsections (a), (b), (d), (e), (f), (h), and (i) of Section 40-18-25. Such a trust shall utilize the allocation and apportionment rules found in this chapter.

(c) If a person is treated as the owner of any portion of a trust pursuant to 26 U.S.C. §§ 671-679, relating to grantor trusts, and if such person is a financial institution, the person shall take into account the income, deductions, and credits of such trust as provided in 26 U.S.C. in computing its net income under this chapter. Such person also may deduct the administrative and other expenses of the portion of the trust which it is treated as owning.

## Nearby sections

- [Ala. Code § 40-16-1 Section 40-16-1 Definitions](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-1.md)
- [Ala. Code § 40-16-1.1 Section 40-16-1.1 Taxation of Trust as Financial Institution](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-1.1.md)
- [Ala. Code § 40-16-1.2 Section 40-16-1.2 Additional Items Included in Federal Taxable Income; Items Deducted from Federal Taxable Income](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-1.2.md)
- [Ala. Code § 40-16-1.3 Section 40-16-1.3 Net Income of Credit Unions](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-1.3.md)
- [Ala. Code § 40-16-2 Section 40-16-2 Production Credit Associations Taxable Under Chapter](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-2.md)
- [Ala. Code § 40-16-3 Section 40-16-3 Returns](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-3.md)
- [Ala. Code § 40-16-3.1 Section 40-16-3.1 Extension of Due Date for Taxpayers of Financial Institution Excise Tax, Tax Years Beginning on or After January 1, 2021](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-3.1.md)
- [Ala. Code § 40-16-4 Section 40-16-4 Levy; Reporting of Tax; Promulgation of Rules](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-4.md)
- [Ala. Code § 40-16-5 Section 40-16-5 When Tax Due; Extension of Time for Payment](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-5.md)
- [Ala. Code § 40-16-5.1 Section 40-16-5.1 Payment of Estimated Financial Institution Excise Taxes](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-5.1.md)
- [Ala. Code § 40-16-6 Section 40-16-6 Remittance and Disposition of Tax](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-6.md)
- [Ala. Code § 40-16-8 Section 40-16-8 Exemptions and Credits](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-8.md)
- [Ala. Code § 40-16-9 Section 40-16-9 Tax Credits Applied to State Portion of Tax Liability](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-9.md)
- [Ala. Code § 40-16-10 Section 40-16-10 Computation of Net Income of Financial Institutions](https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-10.md)

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/STATE_AL_T40_C16_S40-16-1.1. Check the current official text before relying on it. Not legal advice.