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HB 445

Relating to gross income; to amend Section 40-18-14, Code of Alabama 1975; to exclude difficulty of care payments from gross income

2026 Regular Session Introduced by Mike Shaw

HB 445 excludes difficulty of care payments from Alabama state taxable income, providing tax relief to families compensating caregivers for disabled or chronically ill dependents.

Read for the first time and referred to the House Committee on Ways and Means Education
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Bill Summary · HB 445

Legislative bill overview

HB 445 would amend Alabama's tax code to exclude "difficulty of care payments" from gross income calculations for state tax purposes. This means individuals receiving these payments would not have to count them as taxable income when filing Alabama state income taxes.

Why is this important

Difficulty of care payments typically compensate caregivers—often family members—for the additional costs and burden of caring for disabled or chronically ill individuals. Excluding these from taxable income could provide meaningful financial relief to families managing significant caregiving responsibilities and reduce the tax burden on already-stretched household budgets.

Potential points of contention

  • Revenue impact: Excluding income from taxation reduces state tax revenue, requiring clarification on fiscal impact and whether other revenues would offset this loss
  • Definition ambiguity: The bill doesn't define what qualifies as "difficulty of care payments," which could create inconsistent application and disputes with tax authorities
  • Equity concerns: This benefit may primarily help middle-to-upper income families with the resources to structure formal caregiving arrangements, potentially raising fairness questions
  • Scope limitations: Unclear whether this applies only to family caregivers, professional caregivers, or both, and whether it covers all disability types or specific conditions

Compiled from official sources — confirm details with the bill’s official record.

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