Cents of Urgency

Happy Tax Day to all who celebrate!

 

Legislators have accelerated the pace of the 2025 Session. They completed three session days last week and rumors are they intend to continue that pace moving forward. For those of us advocating for bills still outstanding, time is of the essence.

 

In addition to a few headline issues in both chambers, there is a desire to move quickly on both the general fund and education budgets. Both budgets have cleared their originating chambers and have moved to the opposite chamber for consideration. These leave little time for non-priority bills.

 

1. Rep. David Faulkner’s HB163 (HB163-int.pdf) – The R&D deduction bill, retroactive to 2024, remained off of the Finance & Taxation Committee’s agenda last week as they focused on ETF-related budgets. We are continuing to advocate daily for Senate movement on this bill, especially now that the Committee has completed its work on the education budget.

 

2. Sen. Clyde Chambliss’s SB174 (SB174-int.pdf) – This bill had a busy week. An amendment was added to require a county/municipality to notify the Department of Revenue if a third party is contracted to collect business licenses or business privilege taxes and notify a business entity owing such taxes of the third party’s authority to collect. The bill passed the Senate as amended and is on the House’s Judiciary Committee agenda for Wednesday.

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.

We have been working closely with Chairman Garrett, Revenue, Manufacture Alabama, Bruce Ely and others on preparing this bill for movement with a few friendly amendments. We have also received support from the AICPA and the Council On State Taxation. It is currently on the Ways and Means Committee agenda for Wednesday and we will be advocating for its passage.

 

4. Rep. Terri Collins’s HB365 (HB365-eng.pdf) – Creates the Alabama STEM Council within the Department of Workforce to advise State Government on ways to improve STEM-related education, awareness and workforce development.

Thanks to Rep. Collins’ help, the bill has been amended to include “accounting” as a STEM-related career. The amended bill has passed the second chamber’s committee and should be on the Senate Floor this week. Once passed, the House would have to concur with that amendment.

 

5. 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.

 

6. Rep. Chris Sells’ HB505 (HB505-int.pdf) – This bill includes one notable change that CPAs will want to be aware of: it increases the time allowed to appeal an issue with the Alabama Tax Tribunal or the Circuit Court from 30 days to 60 days. Clearly, we support that change. The bill has cleared the House Committee and is on the House Floor calendar.

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There have been 891 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.