SF 303 (LSB 2169SV (1) 85)

SENATE FILE 303

BY  COMMITTEE ON VETERANS AFFAIRS

(SUCCESSOR TO SSB 1158)

A BILL FOR

An Act exempting federal retirement pay of a resident received for military service from the state individual income tax and including retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 422.7, Code 2013, is amended by adding the following new subsection:
   NEW SUBSECTION.  31A.
  a.  Subtract, to the extent included, retirement pay received by a resident taxpayer from the federal government for military service performed in the armed forces, the armed forces military reserve, or national guard.
   b.  The exclusion of retirement pay under this subsection is in addition to any exclusion provided under subsection 31.
    Sec. 2.  RETROACTIVE APPLICABILITY.  This Act applies retroactively to January 1, 2013, for tax years beginning on or after that date.
EXPLANATION
   This bill exempts from the individual income tax all retirement pay of an Iowa resident from federal military service in the armed forces, the military reserve, or national guard. The exemption is in addition to the general pension exclusion.
   The bill applies retroactively to January 1, 2013, for tax years beginning on or after that date.