Gomer Pyle, WarGames and the end of the quadrennium

Back in the Winter edition of Connections magazine, I made a few not-so-bold predictions.  For example, I stated there would be a few surprises.  Sure, we all knew there would be some.  What we didn’t know was this session’s soundtrack would be one Gomer Pyle catch-phrase on an endless loop…  Surprise, Surprise, Surprise!

 

I also wrote a long explainer on SSUT in anticipation of that being our big bombshell of the session.  After playing what seemed like a virtual game of Global Thermal Nuclear War, both sides came to the same conclusion as the WOPR in the movie WarGames: the only winning move is not to play.  Humanity is safe once again.

 

So many of you will not get those references.  Bless you kids.

 

The Overtime Exemption bill HB527 – Lomax (HB527-eng.pdf) has one Senate vote left before it becomes law.  While most are focusing on the $1,000 deduction for overtime wages in a calendar year, there are some other things to watch for: 1) standard deductions for all state taxpayers are modified, and 2) the state’s 2% sales tax on groceries would be suspended during the months of May and June of 2026.  Those provisions are subject to change in the Senate, so we’ll watch that debate closely.

 

With THREE(!) days left in the 2026 Legislative Session, our list of issues remains the same as my last report.  I’ve added a couple updates:

 

1. HB17 - Lamb (HB17-int.pdf) – Municipal audit thresholds.  We think it is important to grant small municipalities some relief related to compliance/attest work.  The League of Municipalities and the Department of Examiners have been working with us to get this bill on the Senate calendar and passed.  If the bill passes with a prospective effective date, do not be alarmed.  The Examiners are prepared to hold municipalities accountable to the new standards as soon as the bill is signed.
2. HB250 – Garrett (HB250-int.pdf) & SB79 – Roberts (SB79-int.pdf) – Provides for conformity with certain aspects of the One Big Beautiful Bill Act.  SB79 is on the House’s Special Order Calendar for today.  We are optimistic on it being pushed through this week.
3. HB545 – Crow (HB545-eng.pdf) & SB365 – Hovey (SB365-int.pdf) – Allows for rounding to the nearest nickel.  Seems silly, but this is a good bill that is necessary and needs to pass.
4. SB221 – Orr (SB221-int.pdf) – Excludes credit card transaction fees from being subjected to sales and use tax calculations.  As a refresher, the Alabama Department of Revenue created a rule that states businesses MUST charge sales tax on a credit card transaction fee levied on the consumer by a business if the underlying purchase was subject to sales tax.  These transaction fees are not contemplated in statute.  There are varying opinions on the tax implications of this bill passing.  I believe they are negligible. Others believe the impact could be millions.  Either way, we’ll let you know if it passes.

There have been 1,046 bills filed so far. If we’ve missed something or you have any questions, please do not hesitate to contact me at rpearson@alabama.cpa.

 

Unless there is a special session for some reason, this week will mark the final session of this quadrennium.  For my friends in Calera and Monroeville, that means the end of this 4-year term.  The more you know…