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Minnesota Legislation Would Exempt Military Pensions From Taxes

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Minnesota is one of six states in the country that fully taxes military benefits.

But that could change soon, as two pieces of legislation in the state House seek to exempt some or all of military pensions from taxation.

The first, introduced by Rep. Bob Dettmer, would exempt from taxation the first $30,000 of military retirement benefits earned, regardless of the retiree’s rank.

Rep. Josh Heintzeman has introduced a similar bill. But Heintzeman’s version would exempt all military retirement income from taxation.

More from KARE 11:

Many military retirees end up in warmer states than Minnesota, both when it comes temperatures and tax climate.

But there are several bills in the hopper this year in the State Legislature designed to draw those retirees here, and hold onto the ones who already live in Minnesota.

“Most of them will be in the 40’s, so they’ll be starting a second career and that’s an economic boost for the state,” Rep. Bob Dettmer of Forest Lake told KARE

He said there are 370,000 military veterans living in Minnesota, and at least 18,000 of them were career military members who served long enough to earn a pension.

Rep. Dettmer would like to see at least part of those pensions exempt from state income taxes.

[…]

“If we really want to hire veterans we’ve got to get them to live here. We want to have them stay here, put their kids in school, buy homes, and be part of Minnesota. Many other states have already figured this out.”

Rep. Dettmer’s bill has drawn more support than Heintzeman’s, as some lawmakers are more comfortable with “capping” the tax exemption.

 

Photo by Brian Schlumbohm/Fort Wainwright PAO

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