SB 351 Summary

• Allows Alabama taxpayers not currently residing in the state to claim a state income tax deduction for military pay and allowances if they serve as active duty members of the U.S. Army, Navy, Air Force, Marine Corps, Space Force, or Coast Guard, or serve in reserve components or Alabama National Guard units.

• Prohibits the deduction for military pay and allowances received while the taxpayer is stationed within Alabama.

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

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

• Takes effect for taxable years beginning after December 31, 2021, upon passage and approval by the Governor.