Bill > HB228

This bill amends Alabama's income tax code to create a new tax exemption specifically for members of the Alabama National Guard. Starting January 1, 2026, the bill will allow National Guard members to exclude the first $5,000 of income earned from inactive duty training (IDT) from state income taxes. Inactive duty training refers to scheduled periods of military training performed by reservists and National Guard members outside of their regular active duty service. The exemption is a targeted measure to provide a financial benefit to National Guard members who perform part-time military training in addition to their civilian careers. The bill specifies that this $5,000 tax exemption will be part of the existing list of income tax exemptions in Alabama's tax code, and it will become effective on October 1, 2025, allowing time for implementation and for taxpayers and state revenue agencies to prepare for the change.

Budget and Finance

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