MONTGOMERY, Ala. — The Alabama Senate has approved a modest state income tax cut for low-income earners that will save families an average of $21 each year.
Senators voted 28-0 for the proposal to allow more taxpayers to take the maximum standard deduction. The bill now moves to the House of Representatives.
Senate President Pro Tempore Del Marsh said the tax cut is aimed at working families and high-income people would not qualify.
It increases the adjusted gross income level where jointly filing married taxpayers qualify for the full $7,500 standard deduction from $20,000 to $23,000. The deduction would be lowered as incomes rise. There would be similar changes for singles.
The Legislative Fiscal Office estimated the tax cut is collectively worth $4 million. Marsh’s office estimated it would impact 182,000 tax returns.