For certified Alabama firefighters, effective starting with the tax year 2020, they are eligible to deduct 100% of the insurance premiums paid specifically for cancer insurance coverage. However, this deduction applies only if these premiums haven't already been deducted from federal gross income or aren’t otherwise deductible under another provision of law. It's important to note that insurance premiums paid using pre-tax dollars cannot be claimed for this deduction.
This benefit is outlined in both Form 40 and Form 40NR, where it specifies that such deductions should be reported accordingly on Line 7 for non-residents (Form 40NR) and Line 14 for residents (Form 40).
Relevant Forms & Publications:
- Forms:
- Form 40: Used by resident taxpayers in Alabama; includes details about allowable deductions including those for certified firefighter insurance premiums.
- Form 40NR: Utilized by nonresident taxpayers earning income within Alabama; also covers similar provisions regarding firefighter insurance premium deductions.
These guidelines ensure compliance with Act 2019-361, allowing certified firefighters to potentially reduce their taxable income through these specified deductions.
Source:
https://www.revenue.alabama.gov/ultraviewer/viewer/basic_viewer/index.html?form=2025/01/24f40bk.pdf
https://www.revenue.alabama.gov/ultraviewer/viewer/basic_viewer/index.html?form=2025/01/24f40nrbk.pdf