Senate Bill No. 460

(By Senators Wells, Green, Barnes, Beach, Edgell, Fitzsimmons, Laird, Snyder, Sypolt, Walters, Yost, Unger, Kessler (Mr. President), Stollings, Jenkins, Cann, Plymale and Williams)

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[Introduced March 6, 2013; referred to the Committee on Military; and then to the Committee on Finance.]

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A BILL to amend and reenact §11-21-12e of the Code of West Virginia, 1931, as amended, relating to taxation; personal income tax; and exempting active duty military pay for resident individuals serving thirty or more continuous days on active duty in the armed forces of the United States, National Guard or armed forces reserves for the taxable year in which the individual has separated from active military service.

Be it enacted by the Legislature of West Virginia:

    That §11-21-12e of the Code of West Virginia, 1931, as amended, be amended and reenacted to read as follows:

ARTICLE 21. PERSONAL INCOME TAX.

PART I. GENERAL.

§11-21-12e. Additional modification reducing federal adjusted gross income.

    (a) For taxable years beginning after December 31, 2000, in addition to amounts authorized to be subtracted from federal adjusted gross income pursuant to subsection (c), section twelve of this article, active duty military pay received for the period of time an individual is on active duty as a member of the National Guard or Armed Forces Reserves called to active duty pursuant to an Executive Order of the President of the United States for duty in “operation enduring freedom” or for domestic security duty is an authorized modification reducing federal adjusted gross income, but only to the extent the active duty military pay is included in federal adjusted gross income for the taxable year in which it is received.

    (b) For taxable years beginning after December 31, 2012, in addition to amounts authorized to be subtracted from federal adjusted gross income pursuant to subsection (c), section twelve of this article, active duty military pay received by a resident individual who is on active duty for thirty continuous days or more in the armed forces of the United States, the National Guard or Armed Forces Reserves is an authorized modification reducing federal adjusted gross income for the taxable year in which the individual has separated from active military service, but only to the extent the active duty military pay is included in federal adjusted gross income for the taxable year in which it is received.

    NOTE: The purpose of this bill is to exempt from state income tax active duty military pay for resident individuals serving thirty or more continuous days on active duty in the armed forces of the United States, National Guard or Armed Forces Reserves for the taxable year in which the individual has separated from active military service.

    Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.