April Fools

"If you do not take an interest in the affairs of your government, then you are doomed to live under the rule of fools." - Plato

This quote popped up as a ode to this date on the calendar but it sent us down a different rabbit hole about what Plato, who lived c. 2400 years ago and never coached in a Final Four, may have known about income taxes. You be the judge:

"When there is an income tax, the just man will pay more and the unjust less on the same amount of income."

On to present day, our state legislature is back in session this week and will look to begin the hard work of passing budgets. We look for things to be real interesting real quick as debates on sales taxes, gambling, healthcare and other issues take center stage. As always, please contact me if you have any questions or comments about pending legislation.

 

1. Rep. David Faulkner’s HB163 (HB163-int.pdf) – The R&D deduction bill, retroactive to 2024, has passed in the House and is anticipated to be in Senate committee tomorrow (April 2nd).

 

2. Sen. Clyde Chambliss’s SB174 (SB174-int.pdf) – No update from last week. The business and municipality community has built a solid consensus around this bill in a way that gives it a great chance of passing.

Currently, unfair business license taxes require taxpayers to appeal to the circuit court in the jurisdiction of the taxing agency. The ability to file these appeals with the Alabama Tax Tribunal saves taxpayers time and money. We are advocating for the passage of this bill.

 

3. Rep. Danny Garrett’s HB379 (HB379-int.pdf) – Creates conditions under which a non-resident employee working temporarily in Alabama can be exempt from withholding and paying Alabama income tax.

The Society is working with the Department of Revenue, Manufacture Alabama and other organizations to add compliance clarity, simplification and consistency among a greater number of states. We’d also like to add additional exemptions such as for trade shows, CPE and disaster relief workers. We believe our recommendations will improve compliance and create economic opportunities for the state without negatively impacting the state’s budget.

 

4. Chairman Garrett’s HB386-389 (HB386-int.pdf, HB387-int.pdf, HB388-int.pdf, HB389-int.pdf) – This series of bills would make permanent tax-reductions to grocery sales taxes, increases the optional standard deduction for income taxes, and increases the tax exemption for taxable retirement income. These bills have passed the House.

CLICK HERE FOR THE WATCHLIST

There have been 746 bills filed as of this weekend. The bills in their entirety can be found at https://alison.legislature.state.al.us and, if you have any additional questions or comments, please reach out to me at rpearson@alabama.cpa.