SSB 1236

The percentage of this retirement income that is excluded for tax years beginning in 2019, 2020, 2021, and 2020, is percent, percent, percent, and percent, respectively. For tax years beginning in 2023 or later, 100 percent of a taxpayer’s retirement income will be excluded from the individual income tax.5, and further provides that any retirement income excluded from the individual income tax will not be added back to these calculations for tax years beginning in 2023 or later. The bill defines “retirement income” for purposes of the exclusion. Under current law, a taxpayer may exclude all retirement pay, including certain survivor benefits, received from the federal government for military service performed in the armed forces, the armed forces military reserve, or national guard. In addition, a taxpayer who is disabled, who is at least years of age, or who is the surviving spouse or other specified survivor of that qualifying taxpayer, may exclude a maximum of $6,000 of other retirement income ($12,000 for married couples). The bill applies retroactively to January 1, 2019, for tax years beginning on or after that date.