Senate
File
2109
-
Introduced
SENATE
FILE
2109
BY
CHAPMAN
A
BILL
FOR
An
Act
exempting
all
retirement
income
from
the
individual
1
income
tax
and
including
retroactive
applicability
2
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
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2109
Section
1.
Section
422.7,
subsection
31,
Code
2018,
is
1
amended
to
read
as
follows:
2
31.
For
a
person
who
is
disabled,
or
is
fifty-five
years
of
3
age
or
older,
or
is
the
surviving
spouse
of
an
individual
or
4
a
survivor
having
an
insurable
interest
in
an
individual
who
5
would
have
qualified
for
the
exemption
under
this
subsection
6
for
the
tax
year,
subtract,
Subtract,
to
the
extent
included,
7
the
total
amount
of
a
governmental
or
other
pension
or
8
retirement
pay,
including
,
but
not
limited
to
,
defined
benefit
9
or
defined
contribution
plans,
annuities,
individual
retirement
10
accounts,
plans
maintained
or
contributed
to
by
an
employer,
11
or
maintained
or
contributed
to
by
a
self-employed
person
as
12
an
employer,
and
deferred
compensation
plans
or
any
earnings
13
attributable
to
the
deferred
compensation
plans
,
up
to
a
14
maximum
of
six
thousand
dollars
for
a
person,
other
than
a
15
husband
or
wife,
who
files
a
separate
state
income
tax
return
16
and
up
to
a
maximum
of
twelve
thousand
dollars
for
a
husband
17
and
wife
who
file
a
joint
state
income
tax
return.
However,
a
18
surviving
spouse
who
is
not
disabled
or
fifty-five
years
of
age
19
or
older
can
only
exclude
the
amount
of
pension
or
retirement
20
pay
received
as
a
result
of
the
death
of
the
other
spouse.
A
21
husband
and
wife
filing
separate
state
income
tax
returns
or
22
separately
on
a
combined
state
return
are
allowed
a
combined
23
maximum
exclusion
under
this
subsection
of
up
to
twelve
24
thousand
dollars.
The
twelve
thousand
dollar
exclusion
shall
25
be
allocated
to
the
husband
or
wife
in
the
proportion
that
each
26
spouse’s
respective
pension
and
retirement
pay
received
bears
27
to
total
combined
pension
and
retirement
pay
received
.
28
Sec.
2.
RETROACTIVE
APPLICABILITY.
This
Act
applies
29
retroactively
to
January
1,
2018,
for
tax
years
beginning
on
30
or
after
that
date.
31
EXPLANATION
32
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
33
the
explanation’s
substance
by
the
members
of
the
general
assembly.
34
This
bill
relates
to
the
exemption
of
retirement
income
from
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2109
the
individual
income
tax.
1
Under
current
law,
a
taxpayer
may
exclude
from
the
2
computation
of
the
individual
income
tax
all
retirement
pay,
3
including
certain
survivor
benefits,
received
from
the
federal
4
government
for
military
service
performed
in
the
armed
forces,
5
the
armed
forces
military
reserve,
or
national
guard.
In
6
addition,
a
taxpayer
who
is
disabled,
who
is
at
least
55
years
7
of
age,
or
who
is
the
surviving
spouse
or
other
specified
8
survivor
of
that
qualifying
taxpayer,
may
exclude
from
the
9
computation
of
the
individual
income
tax
a
maximum
of
$6,000
of
10
other
retirement
income
($12,000
for
married
couples).
11
The
bill
exempts
all
retirement
income
from
individual
12
income
tax.
13
The
bill
applies
retroactively
to
January
1,
2018,
for
tax
14
years
beginning
on
or
after
that
date.
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