SB333 Alabama 2024 Session

Summary

Primary Sponsor

Bobby D. SingletonSenator

Democrat

Session

Regular Session 2024

Title

Taxation, tax credits, Alabama employers provided a tax credit for employees eligible under the federal Work Opportunity Tax Credit program.

Summary

SB333 would create Alabama tax credits for employers who hire workers eligible for the federal Work Opportunity Tax Credit, with limits on amount and timing.

What This Bill Does

The bill lets Alabama employers claim an income tax credit (or financial institution excise tax credit) for employees who are eligible under the federal Work Opportunity Tax Credit program. The credit equals the federal WOTC amount claimed for that employee, up to $1,000, and becomes available in the tax year after the employee completes 12 consecutive months of employment. Credits are nonrefundable, cannot reduce tax liability below zero, and are capped at $10 million per fiscal year; they can be allocated pro rata to owners or members of pass-through entities taxed as S- or K-Corps. The Department of Revenue would set the rules to implement the program, and the credit starts with tax year 2025.

Who It Affects

• Alabama employers that pay income tax or financial institution excise tax and hire individuals in WOTC targeted groups, who could claim the credit for eligible employees.
• Employees who are part of the WOTC targeted groups, as their 12-month employment period triggers the employer's eligible credit.
• Owners or members of qualified Alabama businesses taxed as S- or K-Corps, who receive a pro rata share of the credit.

Key Provisions

• Establishes Alabama income tax and financial institution excise tax credits for hiring individuals in WOTC targeted groups.
• The credit amount equals the federal WOTC credit claimed, up to $1,000 per employee, and is available in the year the employee completes 12 consecutive months of employment.
• Credits are nonrefundable, not transferable, and cannot reduce any tax liability below zero; credits can be allocated pro rata to owners/members of S- or K-Corp entities.
• Annual cap of $10,000,000 in credits per fiscal year while the credit is available.
• Credit can be claimed for tax years beginning January 1, 2025 and for later years; Department of Revenue may adopt rules to implement the act; effective January 1, 2025.

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

Subjects

Taxation & Revenue