Income tax; certain compensation of civilian employees of Armed Forces, exempt

SB 69 expands Alabama's existing income tax exemption for active-duty military personnel to include civilian employees of the U.S. Department of Defense and Armed Forces. It exempts their compensation from state income tax when earned while serving in a combat zone, deployed outside the U.S., or activated for emergencies by Alabama's governor or the President. This change directly affects civilian defense workers who meet these specific service conditions. The exemption applies to tax years beginning January 1, 2027.