Senate Bill 69 Alabama 2026 Session

Summary

Primary Sponsor

Sam GivhanSenator

Republican

Session

2026 Regular Session

Title

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

Summary

SB69 would exempt certain pay of civilian employees of the U.S. Department of Defense and Armed Forces from Alabama state income tax when earned in combat zones, while deployed overseas, or activated for emergencies.

What This Bill Does

If enacted, the bill would expand Alabama's income tax exemption to cover compensation paid to civilian DoD/Armed Forces employees under the same conditions the state already exempts for active-duty service members. The exemption would apply to pay earned while the individual is in a combat zone, deployed outside the United States, or activated to support emergencies. The exemption begins with tax years beginning on or after January 1, 2027, and the act becomes effective January 1, 2027.

Who It Affects

• Civilian employees of the U.S. Department of Defense or U.S. Armed Forces who are paid while in combat zones, deployed outside the United States, or activated for emergencies will not owe Alabama state income tax on that pay.
• Alabama tax administration and employers that withhold state taxes will implement and apply the exemption when the specified conditions are met.

Key Provisions

• Exempts civilian compensation paid by the U.S. Department of Defense or Armed Forces from Alabama state income tax when earned in a combat zone, during deployment outside the U.S., or during activation for emergencies.
• Effective for tax years beginning January 1, 2027, with the act taking effect January 1, 2027.

AI-generated summary using openai/gpt-5-nano on Feb 12, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation & Revenue