Alabama House Passes Overtime Tax Break, Grocery Tax Holiday

Alabama's House just Greenlit, House Bill 527, offering tax breaks on overtime pay and a short grocery tax pause.

The big win lets folks deduct up to $1,000 of overtime from their state taxes starting in 2026, but its sunsets after 20, 28 unless renewed.

Lawmakers tweaked the bill to add a 60-day holiday on the state grocery tax, bumping the total cost from $37,400,000.

Dollars for overtime alone to $83,400,000 overall.

This comes as Alabama keeps chipping away at grocery taxes down to 3% in 2023, now at 2% heading into next year, with eyes on full elimination down the road.

Supporters say it's a smart move to lighten the load on working families grinding extra hours to keep the economy humming, straight from sponsor rep.

James Lomax and Amendment Bakker, Rhett Mike Shaw.

The bill heads to the next round for more debate. Part of Alabama's push to tackle rising costs on everyday needs, keep watching how it plays out for.

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