HB41 Alabama 2020 Session

Summary

Primary Sponsor

Paul W. LeeRepresentative

Republican

Session

Regular Session 2020

Title

Taxation, provide income tax deduction, military stationed out of state

Summary

HB 41 would allow Alabama active-duty military residents stationed outside Alabama to deduct their active-duty pay and allowances on Alabama income tax returns.

What This Bill Does

If passed, eligible Alabama residents on active duty who are stationed outside Alabama could deduct their active-duty military pay and allowances from Alabama adjusted gross income, as long as the pay isn’t already deductible or excluded. The deduction would not apply to pay and allowances received while the service member is stationed in Alabama. Individuals must certify their residency status to the Department of Revenue each year, and the Department would adopt rules to enforce the act. The deduction would take effect for tax years beginning after December 31, 2020.

Who It Affects

• Alabama residents on active duty who are stationed outside Alabama and would be able to claim a deduction for eligible pay and allowances not otherwise deductible or excluded.
• Alabama Department of Revenue, which would require yearly residency certifications and implement enforcement rules.

Key Provisions

• Active-duty Alabama residents not currently residing in the state may deduct military pay and allowances received during the taxable year for active-duty service outside Alabama, not for pay while stationed in Alabama.
• Taxpayers must certify annually their residence status on forms provided by the Department of Revenue to claim the deduction.
• The Department of Revenue must adopt rules necessary to enforce the act.
• The act takes effect for taxable years beginning after December 31, 2020.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Revenue Department