House Bill 250 Alabama 2026 Session

Updated Feb 17, 2026

Summary

Primary Sponsor: Danny GarrettRepresentative
Republican
Session: 2026 Regular Session
Title: Individual income taxes, to allow an exclusion from gross income for contributions to Trump Accounts and to make permanent the exclusion for amounts paid by an employer on any qualified education loan.
Summary: HB250 would exclude employer contributions to Trump Accounts from Alabama gross income and permanently allow the employer-paid education loan exclusion for individual taxpayers.
What This Bill Does
It amends Alabama's gross income rules to exclude employer contributions to a Trump Account from an individual's Alabama gross income. It also makes permanent the federal rule that amounts paid by an employer toward an employee's qualified education loan are excluded from gross income. The act becomes effective May 1, 2026. It adds employer payroll data reporting requirements to the Department of Revenue, including overtime pay data and related employee counts, with specific filing timelines and oversight.

Who It Affects
Alabama resident or nonresident individual taxpayers who would see employer contributions to Trump Accounts and employer-paid education loan repayments excluded from their Alabama gross income.
Alabama employers and payroll processors who must implement these exclusions and comply with new reporting requirements on overtime pay and payroll data.

Key Provisions
Exclude employer contributions to Trump Accounts from an individual taxpayer's gross income for Alabama tax purposes.
Make permanent the exclusion from gross income for amounts paid by an employer toward an employee's qualified education loan (per federal rules).
Effective date: May 1, 2026.
Define gross income for Alabama residents and nonresidents and set rules to apply exclusions across applicable income sources.
Impose new employer reporting requirements to the Department of Revenue for overtime pay data, with specified filing deadlines and periodic submissions to state agencies.

AI-generated summary using openai/gpt-5-nano on Feb 11, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Taxation & Revenue