HB261 Alabama 2012 Session

Summary

Primary Sponsor

Thad McClammy

Democrat

Session

Regular Session 2012

Title

Income tax, tax credit for hiring certain persons under age 19 during school breaks, after school, or on weekends

Summary

HB261 would create a state income tax credit for employers that hire student workers under 19 during school breaks, after school, or on weekends, with retention requirements and zone-based eligible areas.

What This Bill Does

It allows an income tax credit for wages paid to each student worker under 19 who is enrolled in school and works during breaks, after school, weekends, or summer/holidays, provided the worker is kept for at least nine months. The credit equals the student's wages for the taxable year, up to $2,500 per student per year, and is claimed in the year the nine-month period ends and the following year. The credit cannot exceed 50% of the taxpayer's income tax due for the year (after other credits) and unused credits can be carried forward for up to five years. The credit is available only to qualifying employers in designated zones (8A Business, Empowerment Zone, HUB Zones, I-65 Corridor, Renewal Community, Tax Incremental Financial Zones, Enterprise Zone) and takes effect for 2013 and later tax years, with immediate effect upon passage in the usual constitutional manner.

Who It Affects

• Student workers under age 19 who are enrolled in school and work during breaks, after school, weekends, or during summer/holidays (their employment is the basis for the employer's tax credit).
• Employers in designated Alabama zones (8A Business, Empowerment Zone, HUB Zones, I-65 Corridor, Renewal Community, Tax Incremental Financial Zones, Enterprise Zone) that hire and retain such student workers for at least nine months.
• Taxpayers with Alabama income tax liability who can claim the credit against their tax and may use carryforwards for up to five years.

Key Provisions

• Creates an income tax credit for hiring student workers under 19 who are enrolled in school and work during school breaks, after school, or on weekends (including summer/holidays).
• Requires the student worker to be retained for at least nine months for the employer to qualify for the credit.
• Sets the credit amount equal to wages paid to the student during the taxable year, up to a maximum of $2,500 per student per year.
• The taxpayer claims the credit in the year the nine-month period ends and the following year.
• Credit cannot exceed 50% of the taxpayer's income tax due for the year, after other credits; unused portions can be carried forward for up to five years.
• Eligibility limited to employers in specific zones: 8A Business, Empowerment Zone, HUB Zones, I-65 Corridor, Renewal Community, Tax Incremental Financial Zones, and Enterprise Zone.
• Effective date: January 1, 2013 for 2013 and subsequent tax years; act becomes effective immediately after passage and Governor's approval.

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

Subjects

Taxation