Bill Text: IA SF124 | 2017-2018 | 87th General Assembly | Introduced

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Bill Title: A bill for an act exempting military disability benefits and certain military pay from the computation of the individual income tax and including retroactive applicability provisions.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2017-02-17 - Fiscal note. [SF124 Detail]

Download: Iowa-2017-SF124-Introduced.html

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Senate File 124 - Introduced




                                 SENATE FILE       
                                 BY  CHELGREN

                                      A BILL FOR

  1 An Act exempting military disability benefits and certain
  2    military pay from the computation of the individual income
  3    tax and including retroactive applicability provisions.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN



  1  1    Section 1.  Section 422.7, subsection 42A, Code 2017, is
  1  2 amended to read as follows:
  1  3    42A.  Subtract, to the extent included, all pay of the
  1  4 following:
  1  5    a.  Pay received by the taxpayer from the federal government
  1  6 for military service performed while on active duty status in
  1  7 the armed forces, the armed forces military reserve, or the
  1  8 national guard.
  1  9    b.  Disability compensation and benefits received by the
  1 10 taxpayer from the federal government for a service=connected
  1 11 disability certified by the United States department of
  1 12 veterans affairs.
  1 13    Sec. 2.  RETROACTIVE APPLICABILITY.  This Act applies
  1 14 retroactively to January 1, 2017, for tax years beginning on
  1 15 or after that date.
  1 16                           EXPLANATION
  1 17 The inclusion of this explanation does not constitute agreement with
  1 18 the explanation's substance by the members of the general assembly.
  1 19    This bill exempts military disability benefits and certain
  1 20 military pay from the individual income tax.  Current law
  1 21 exempts from the individual income tax all pay from the federal
  1 22 government for military service performed while on active duty
  1 23 status in the armed forces, the armed forces military reserve,
  1 24 or national guard.  The bill strikes the active duty status
  1 25 requirement related to that exemption.  As a result, all pay
  1 26 from the federal government for military service performed in
  1 27 the armed forces, the armed forces military reserve, or the
  1 28 national guard will be exempt from the individual income tax.
  1 29    The bill also exempts from the individual income tax all
  1 30 disability compensation and benefits received from the federal
  1 31 government for a service=connected disability certified by the
  1 32 United States department of veterans affairs.
  1 33    The bill applies retroactively to January 1, 2017, for tax
  1 34 years beginning on or after that date.
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