SB531 Alabama 2010 Session

Summary

Primary Sponsor

Rodger SmithermanSenator

Democrat

Session

Regular Session 2010

Title

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

Summary

The Reemployment Act of 2010 creates an income tax deduction for Alabama employers who hire unemployed workers, with wage-based credits and eligibility rules.

What This Bill Does

The bill provides an income tax deduction for employers that hire a person who was drawing unemployment or whose benefits had expired. The deduction is a percentage of the new hire's gross wages and can be claimed in one tax year after the employee works continuously for 12 months. The percentage depends on wage rate (50% at $14/hour or more, 40% for $12-$14, 35% for $10-$12, none below $10, and none for part-time jobs) and the deduction is non-refundable and non-transferable. It is available for tax years 2011 and 2012 and may be claimed pro rata by owners of pass-through entities; the worker's unemployment status must be certified by the local unemployment agency, and the Department of Revenue will set related rules.

Who It Affects

• Employers in Alabama that create new jobs and hire workers who were unemployed or whose unemployment benefits had expired, who would be eligible for a wage-based income tax deduction.
• Owners of qualified employing entities taxed under S or K subchapters of the Internal Revenue Code, who may claim the deduction on a pro rata basis.

Key Provisions

• Establishes an Alabama income tax deduction for employers that create new jobs for unemployed persons; deduction equals a percentage of gross wages paid to each eligible hire and is limited to employees who were unemployed or whose benefits had expired.
• Percentage tiers: 50% for wage rates $14/hour and above; 40% for $12-$14/hour; 35% for $10-$12/hour; no deduction for less than $10/hour; no deduction for part-time jobs (less than 37.5 hours per week).
• Deduction can be claimed in only one tax year and only after the employee has been continuously employed for 12 months following hire; evidence of unemployment status must be certified by the local unemployment agency.
• Deduction is applied against the Alabama income tax under Chapter 18, Title 40; the deduction is non-refundable and non-transferable; available pro rata to owners of S- or K-subchapter entities.
• The Department of Revenue may adopt rules to implement the act; the act is effective for tax years 2011 and 2012; provisions are severable; conflicting laws are repealed.

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