AL HB407

Amends Alabama Code Section 40-18-14 to exempt amounts paid as overtime compensation in accordance with the U.S. Fair Labor Standards Act from state income tax.

Exemption applies to overtime compensation beginning on the effective date of the act through June 30, 2025.

For employers governed by the National Railway Labor Act, the exemption applies specifically to hourly component overtime compensation as defined in applicable collective bargaining agreements.

Requires employers to submit monthly or quarterly reports to the Department of Revenue detailing total overtime amounts paid and number of employees receiving such compensation.

Becomes effective on October 1, 2024.