SB523 Alabama 2010 Session

Summary

Primary Sponsor

Wendell Mitchell

Democrat

Co-Sponsor

George M. “Marc” Keahey

Session

Regular Session 2010

Title

Income tax, employment, employers hiring persons receiving unemployment compensation or whose benefits have expired, tax deduction authorized under certain conditions, duties to Revenue Department, Reemployment Act

Summary

SB523 creates a temporary Alabama income tax deduction for employers who hire unemployed individuals or workers whose unemployment benefits have expired, based on a share of wages paid for 12 months, for tax years 2011 and 2012.

What This Bill Does

It would create an income tax deduction for Alabama employers that hire unemployed people or workers whose unemployment benefits have expired. The deduction would be 50% of gross wages for each eligible employee, with tiered limits: 50% for wages at 14 dollars per hour or more, 40% for 12 to 14 dollars per hour, and 35% for 10 to 12 dollars per hour, with no deduction for wages below 10 dollars per hour and only for full time work (37.5 hours per week). The employee must have been continuously employed for 12 months after hire, and the worker's unemployment status must be certified by the local employment agency; the deduction can be claimed in a single tax year and is not refundable or transferable, but is available pro rata to owners of pass-through entities taxed as S or K corporations. The Department of Revenue would set rules, and the measure would apply to tax years 2011 and 2012.

Who It Affects

• Employers in Alabama that hire unemployed individuals or those whose unemployment benefits have expired; they could qualify for a tax deduction on their Alabama income tax, subject to wage, hours, and 12-month employment requirements.
• Owners of pass-through businesses (S- or K-corporations) in Alabama; they could receive the deduction on a pro rata basis relative to their ownership.

Key Provisions

• Establishes an Alabama income tax deduction for employers that hire unemployed persons or those whose unemployment benefits have expired.
• Deduction equals a percentage of each eligible employee’s gross wages, with 50% for wages at or above 14/hour, 40% for 12–14/hour, 35% for 10–12/hour, and none below 10/hour, and restricted to full-time positions (37.5 hours/week).
• Employee unemployment status must be certified by the local employment agency; deduction can be claimed in only one tax year and only after 12 consecutive months of employment; not refundable or transferable; available pro rata to owners of S- or K-corp pass-throughs.
• Effective for tax years 2011 and 2012; Department of Revenue to adopt rules to carry out the act; repeal or override of conflicting laws.

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