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2006-06-11 15:51:56 · 3 answers · asked by reparmn37 2 in Politics & Government Military

3 answers

States are generally free from federal control in deciding how to tax pensions, but some limits apply. State tax policy cannot discriminate against federal civil service pensions. Ten states exclude all federal, state and local pension income from taxation. These include Alabama, Hawaii, Illinois, Kansas, Louisiana, Massachusetts, Michigan, Mississippi, New York and Pennsylvania. Among these 10 states, only Kansas taxes any Social Security income, but only to the extent it is subject to federal taxation. These 10 states differ on the taxation of retirement income from private-sector sources. Kansas and Massachusetts do not exclude any private-sector retirement income, but most of the others allow a fairly broad exclusion. Pennsylvania allows a full exclusion. Alabama excludes income from defined benefit plans. Hawaii excludes income from contributory plans. Illinois and Mississippi exclude income from qualified retirement plans. Louisiana, Michigan and New York cap the private-sector exclusion at $6,000, $34,920 and $20,000, respectively.

more info on the link

2006-06-11 21:13:23 · answer #1 · answered by MP US Army 7 · 2 0

If it is for property tax or a sales tax, they can. I am not sure about income tax, but it seems that if it were taxed by the state, the 10th amendment would apply. The 10th amendment states that all laws which are not designated by Congress to be the jurisdiction of the federal government are jurisdictions of the state. Military pay is the jurisdiction of the federal government.

So my answer is, I don't think they can, but let's see what everyone else says.

2006-06-11 15:57:38 · answer #2 · answered by Roseknows 4 · 0 0

Wisconsin doesn't tax military retirement

2006-06-12 04:05:32 · answer #3 · answered by Molly 6 · 0 0

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