SB165 Summary

• Amends Section 40-18-15 of the Alabama Code to allow married taxpayers filing separate returns to independently elect the optional standard deduction, rather than requiring both spouses to make the same election.

• Previously, if one spouse filing separately elected the optional standard deduction, the other spouse was required to do the same unless they lived apart for the entire year; this bill removes that restriction.

• Married taxpayers filing separate returns with adjusted gross income of $10,000 or less receive a standard deduction of $3,750, reduced by $88 for each $250 of income above $10,000, with a minimum of $2,000.

• Maintains the requirement that if spouses live apart for the entire year, each may claim either the optional standard deduction or itemized deductions independently.

• Effective for tax returns filed for the 2014 and subsequent tax years.