HB230 Alabama 2011 Session

Updated Feb 27, 2026

Notable

Summary

Primary Sponsor: Dexter Grimsley
Democrat
Co-Sponsors: Mike Hubbard Ed Henry April Weaver Paul W. Lee Dan Williams Lynn Greer William Roberts Terri Collins Kerry Rich K.L. Brown Lawrence McAdory Elaine Beech Mary Sue McClurkin Wes Long Richard Baughn Becky Nordgren Allen Farley Darrio Melton Mark Tuggle Bill Poole Paul Beckman Mike Jones Daniel H. Boman Wayne Johnson Jim Patterson Ken Johnson John Merrill Donnie Chesteen Kurt Wallace Alan Boothe Ron Johnson Allen Treadaway Jack Williams Victor Gaston Jay Love Gregory Canfield Mac McCutcheon Mike Hill Craig Ford Elwyn Thomas Jeremy Oden Patricia Todd Steve Hurst Barbara Bigsby Boyd Artis McCampbell Dickie Drake Joe Hubbard Harry Shiver Blaine Galliher Greg Wren Micky Hammon Phil Williams Howard Sanderford Duwayne Bridges Barry Mask Steve Clouse Randy Wood Jamie Ison Steve McMillan Chad Fincher Joe Faust Laura Hall
Session: Regular Session 2011
Title: Income tax credit authorized for employers creating jobs, under certain conditions, Full Employment Act, Secs. 40-18-270, 40-18-271, 40-18-272 repealed; Act 2010-557, 2010 Reg. Sess. repealed
Summary: HB230 creates a nonrefundable $1,000 income tax credit for small Alabama employers who add new full-time jobs paying over $10/hour and repeals a prior tax credit law.
What This Bill Does
It grants a $1,000 credit for each new qualifying employee after they complete 12 months of employment, to small businesses (50 or fewer employees) that add full-time jobs in Alabama paying more than $10/hour. The employer must show a net increase in Alabama full-time employees each tax year, with the growth covering the current year's new hires plus any credits claimed in prior years. The credit reduces the employer's Alabama tax liability (Chapter 16 or 18) but is not refundable or transferable, and owners of pass-through entities receive credit on a pro rata basis. Financial institutions can claim the credit against Chapter 16 liabilities. Employees must be hired after the act becomes law, and the act applies to tax years beginning in 2011.

Who It Affects
Small businesses in Alabama (50 or fewer employees) that create new full-time jobs paying more than $10/hour and meet the net employment growth requirements.
Owners of qualified employers that are S- or K-corporations (pass-through entities) and financial institutions that can claim the credit against their Alabama tax liability on a pro rata basis.

Key Provisions
Defines a small business as one with 50 or fewer employees on the act's effective date.
Provides a $1,000 income tax credit for each new qualifying employee after 12 months of consecutive employment, available in the tax year the employee completes 12 months.
Requires a net increase in Alabama full-time employees each tax year; the increase must cover current-year new hires and prior-year credits (with specific proportional requirements).
Credit is nonrefundable and nontransferable; available on a pro rata basis to owners of pass-through entities (S or K).
Allows the credit against Chapter 16 or Chapter 18 taxes; financial institutions may claim against Chapter 16 liability.
Credits may be claimed only for employees hired after the act is signed; effective for tax years beginning on or after January 1, 2011.
Repeals Act 2010-557 and related provisions; the act is severable and supersedes conflicting laws.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Business and Commerce