Alabama to Offer Tax Relief to Hourly Employees Starting in 2024
In a move to benefit the hardworking citizens of Alabama, Governor Kay Ivey has signed into law a bill that will exempt state income tax on overtime pay for certain hourly employees in the state. This new legislation, set to go into effect on January 1, 2024, aims to provide tax relief to these employees.
During the signing of the bill, Governor Ivey expressed her confidence in the work ethic of the people of Alabama, stating, “When opportunities and sometimes challenges present themselves, the citizens of our state get the job done.”
The new law will bring significant changes for full-time hourly workers in Alabama, as it will eliminate the state income tax on overtime pay. This change is expected to result in a 5% increase in salary for those who work more than 40 hours per week.
Anthony Daniels, the sponsor of the bill, highlighted the positive impact this legislation will have on workers, stating, “From a productivity standpoint, it gives workers the opportunity to earn more money without the employer having to give a pay raise.”
The legislation will remain in effect until June 2025, providing tax relief and offsetting the loss of income for Alabama hourly workers. This is expected to result in increased spending, which will in turn boost tax revenue at the local and state level.
Overall, the new law signifies a significant step forward for hourly employees in Alabama, offering them the opportunity to increase their earnings and improve their financial well-being.