AL SB5

Allows Alabama taxpayers not residing in the state who serve on active duty or in reserve components of the U.S. Armed Forces or Alabama National Guard to deduct military pay and allowances from Alabama income tax returns.

Deduction applies only to military personnel stationed outside Alabama and excludes any pay received while stationed within the state.

Requires military service members claiming the deduction to annually certify their current residence status to the Alabama Department of Revenue using forms provided by the department.

Directs the Alabama Department of Revenue to adopt rules for implementation and enforcement of the deduction provisions.

Becomes effective for taxable years beginning after December 31, 2020, following passage and gubernatorial approval or otherwise becoming law.