(a) This section shall be known and may be cited as the “Provisional Construction Employer Withholding Act.”
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Terms Used In Alabama Code 40-18-73.1

  • Contract: A legal written agreement that becomes binding when signed.
  • Escrow: Money given to a third party to be held for payment until certain conditions are met.
  • state: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Alabama Code 1-1-1
(b)

(1) Subsequent to August 1, 2007, in addition to the other requirements contained in this title, all provisional construction employers shall be required to:

a. Post a bond of not less than the average estimated annual withholding.
b. Provide a minimum bond in all cases not to be less than five hundred dollars ($500) per employee.
c. Provide the bond in the form of a surety bond, cash bond, or by other bonding or credit device deemed acceptable by the Commissioner of Revenue.
(2) The Department of Revenue will issue a notice of compliance to those provisional construction employers that are in compliance with the registration and bond requirements contained in this section.
(3) If the provisional construction employer fails to provide the notice of compliance to parties upon which they have engaged in contractual relationships, such parties must escrow 10 percent of the total amount of the contract for payment of taxes due the State of Alabama.
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