HB83 Alabama 2010 Session

Summary

Primary Sponsor

Jay Love

Republican

Co-Sponsor

Gerald H. Allen

Session

Regular Session 2010

Title

Income tax, individuals, personal and dependent exemptions increased, phased out of optional standard deduction, provisions to be operational only after certified revenue growth in Education Trust Fund, Secs. 40-18-15, 40-18-19, 40-18-27 am'd.

Summary

HB83 would gradually raise Alabama's personal and dependent exemptions and adjust the standard deduction, but only if Education Trust Fund revenue grows at least 3% annually, with a cap for higher incomes.

What This Bill Does

If the revenue-growth condition is met, the bill would gradually increase individual and dependent exemptions over five years and modify the standard deduction with a new five-year phase-out schedule. The changes would take effect only after the Department of Finance certifies the Education Trust Fund's growth is at least 3% for the next year, and the Department of Revenue would implement them; if the growth target is not met, the changes are tolled and could resume once certified. The bill also constrains enhanced exemptions and deductions for taxpayers with adjusted gross income over $100,000 and applies nonresident deductions to Alabama-source income only.

Who It Affects

• Individual Alabama residents with AGI under $100,000 would receive higher personal exemptions and a larger standard deduction, reducing their taxable income.
• Married couples filing jointly, heads of family, and single filers would have their exemptions and standard-deduction amounts adjusted upward over the five-year period.
• Taxpayers with dependents would see increased dependent exemptions phased in across Adjustment Years One through Five.
• Nonresident taxpayers would have deductions limited to amounts arising from Alabama-source income and would follow proportionate rules for exemptions.
• Taxpayers with AGI over $100,000 would not receive the enhanced exemptions or deductions under this bill.

Key Provisions

• Amendments to sections 40-18-15, 40-18-19, and 40-18-27 to gradually increase personal exemptions, dependent exemptions, and raise the standard deduction phase-out over a five-year period, contingent on certified Education Trust Fund revenue growth.
• A 3% annual Education Trust Fund revenue growth requirement, certification by the Alabama Department of Finance, and implementation by the Department of Revenue if met; if not met, changes are tolled until certification occurs.
• A hard cap prohibiting enhanced exemptions or deductions for taxpayers with adjusted gross income over $100,000.
• A detailed five-year Adjustment Year schedule (One through Five) for personal and dependent exemptions and for the standard deduction, with specific phase-out ranges tied to AGI.
• Effective for tax years beginning after January 1, 2011, subject to certification requirements in Section 2.
• Nonresident deductions and exemptions are limited to Alabama-sourced income, with corresponding allocation rules.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation