As previously announced and as described in the ADP TotalSource's Insights and Solutions bulletin, in June 2023, Alabama enacted House Bill 217  (HB 217 or the Bill), which excludes from gross income for state income tax (SIT) purposes amounts received by a full-time hourly wage-paid employee as compensation for work performed in excess of 40 hours in a week.  This exclusion goes into effect for overtime wages paid beginning Jan. 1, 2024, and is currently scheduled to end on June 30, 2025.

Alabama has enacted House Bill 217 (HB 217), which excludes from gross income for state income tax purposes amounts received by a full-time hourly wage-paid employee as compensation for work performed in excess of 40 hours in a week.

The exemption provided under HB 217 will be in effect for tax years that begin after December 31, 2023, and end prior to June 30, 2025.