INSTRUCTIONS: ALABAMA INVESTMENT INTEREST EXPENSE DEDUCTION (Form 4952A)

Form 4952A is used to document investment interest expenses for deduction purposes when filing your Alabama income tax returns. This document can be obtained from the website maintained by the Alabama Department of Revenue.

Alabama Investment Interest Expense Deduction 4952A Step 1: In the first blank box, enter your name as it appears on your tax return.

Alabama Investment Interest Expense Deduction 4952A Step 2: In the second blank box, enter your identifying number.

Alabama Investment Interest Expense Deduction 4952A Step 3: Check the first box if filing as individual.

Alabama Investment Interest Expense Deduction 4952A Step 4: Check the second box if filing for an estate.

Alabama Investment Interest Expense Deduction 4952A Step 5: Check the third box if filing for a trust.

Alabama Investment Interest Expense Deduction 4952A Step 6: On line 1, enter the interest expense for investment debts paid or accrued during the calendar year in question regardless of when the debt was incurred. In this figure, you should include interest paid or accrued on a loan or part of a loan that is allocable to property held for investment. You should also include investment interest expense reported on Schedule K-1 from a partnership or S corporation. Do not include home mortgage interest or any interest expense that is capitalized, such as construction interest subject to Federal Section 263A.

Alabama Investment Interest Expense Deduction 4952A Step 7: On line 2, enter the disallowed investment interest expense from your previous year's 4952A as entered on line 5 for that year.

Alabama Investment Interest Expense Deduction 4952A Step 8: Add lines 1 and 2. Enter the resulting sum on line 3.

Alabama Investment Interest Expense Deduction 4952A Step 9: Enter your net investment income on line 4.

Alabama Investment Interest Expense Deduction 4952A Step 10: Subtract line 4 from line 3 and enter the resulting difference on line 5. If zero or less, enter "-0-." This figure is the disallowed investment interest expense to be carried forward to the next calendar year.

Alabama Investment Interest Expense Deduction 4952A Step 11: Enter the smaller of line 3 or line 4 on line 6. This figure is your investment interest expense deduction.

Alabama Investment Interest Expense Deduction 4952A Step 12: File this form along with your state income tax return.