HB219 Alabama 2025 Session

Summary

Primary Sponsor

Phillip PettusRepresentative

Republican

Session

2025 Regular Session

Title

Income tax; certain compensation of civilian employees of Armed Forces, exempt

Summary

HB219 would extend Alabama's state income tax exemption to certain compensation paid to civilian employees of the U.S. Department of Defense or Armed Forces, and to active-duty service members, under specific deployment conditions.

What This Bill Does

The bill creates an Alabama state income tax exemption for money paid by the United States to civilian DoD/Armed Forces employees or to active-duty members (including National Guard and Reserve) when the person is in a combat zone, deployed outside the United States, or activated to support emergencies. The exemption would apply to tax years beginning January 1, 2026. It amends the existing section on income taxation to establish this exemption for the specified circumstances.

Who It Affects

• Civilian employees of the U.S. Department of Defense or Armed Forces who receive compensation while they are in a combat zone, deployed outside the United States, or activated to support emergencies.
• Active-duty military personnel (including National Guard and Reserve components) receiving compensation under the same deployment conditions.

Key Provisions

• Exempts from Alabama state income tax certain compensation paid by the United States to civilian DoD/Armed Forces employees, or to active-duty service members, when they are in a combat zone, deployed outside the U.S., or activated to support emergencies.
• Applies to tax years beginning on or after January 1, 2026.
• Amends Section 40-18-3 of the Code of Alabama to implement this exemption, altering how such income is treated for state tax purposes under the specified conditions.

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