Alabama lawmakers are desperate to fund the basic needs of our state, especially now that the BP money has been exhausted. I have a suggestion.
As a retired teacher, most of my yearly income comes from social security and a nice retirement check from Mr. Bronner..These funds generate a significant federal tax liability, a liability that serves as a deduction for my state income tax. This is despite the fact that Alabama does not tax the income from social security or from state retirement accounts.
This is not right. I pay far less Alabama tax than many Alabamians with smaller incomes, some with much smaller incomes.
The suggestion is obvious. There must be a limit, either percentage or absolute, to the size of the federal tax deduction and to the amount of retirement income that is not taxed.