California is the only country that does not release the retirement of tax veterans. Is this the year of change?

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At least Eight attempts In the legislature, California can finally join all other states and provide at least some tax exemptions for military retirement income, which, according to supporters, will help veterans remain in the state and contribute to a qualified workforce.

Assembly James Ramos submitted for the third time, a bill that would allow veterans to release Up to $ 20,000 from their federal pensions if they earn less than $ 125,000 a year. Ramos reduced his proposal last year, seeking to release the entire income from veterans retirement. Senator Kelly SyrtoS Republican of Muruta, presented a Senate’s similar billS

A total of approximately 1.4 million veterans live in California, of which 141,000 receive military retirement income, according to recent data available by the US Department of Defense.

Ramos said the state would take advantage of the retention of veterans in California, where they could work in other sectors after retiring from the army and contributing even more to the tax base. California is housed by the Navy Pacific and tens of thousands of Marines in the Pentelon Camp.

“They contribute to proven work experience in our California workforce. They live in our communities and serve as volunteers and leaders,” said Ramos, Democrat from San Bernardino. “California cannot afford to meet our veterans.”

The aim of the two bills, according to legislators, is to try to keep more relevant military in California. The state has seen its military population withdrawn by approximately 28% due to relocation and death outside the state, being over 195,000 in 2000 just over 141,000 in 2022 According to the US Department of Defense.

There is no evidence of employment rate among retired military (those who have served at least 20 years). However, among the wider group of veterans from 35 to 64 years, about 96 % of those still in the workforce in California are hired, according to data from the Labor Statistics Service.

“The main factor is the cost of living”

Veterans are leaving the state for many reasons, “But the main factor is the cost of living,” said David Boone, President of the San Diego Military Advisory Council, in A A A recent hearing of the State Committee on Taxes and Revenue Bill the Syrto.

“The countries that win veterans have developed strategies to identify and attract veterans in their country,” he said.

California military retirees receive Approximately $ 29,000 each yearwhich represents a total of about $ 4 billion a year in 2022, according to the financial department. The veterans survivors receive a total of $ 400 million.

If the tax exemption was approved, California would lose an average of $ 600 fiscal income for each of the 130,000 eligible veterans as per Legislative analyzerS Governor Gavin Newo offers a similar idea in his budget proposal. His service estimates that the state will cost about $ 130 million in the next fiscal year and $ 85 million each later.

But the financial incentive may be too small to persuade pensioners to remain in California, said the legislative analyst service, which has recently made to achieve the goal of the state to turn it into a more competitive destination.

This is the case of Sue Johnson, a former California, who retires in Nevada after serving 27 years in the Air Force and National Air Guard.

“Although approved, I don’t think it’s enough at this point,” he said. “For my husband and for me … We both had nothing and we worked hard throughout our lives, but reaching the point where this is not recognized in state policies … It’s just too much.”

Teachers, firefighters and police may be interested in reducing tax

The staff of Income and tax committee The Senate also expressed concern that the billo bill may be precedent for other professions.

If the legislature releases retirement income from a profession that is directly beneficial to the public, why should it not expand the same treatment of other exceptional professions, such as teaching, firefighters or police? This can lead to a complex situation where the retirement income of other professions is excluded from gross income, thus eroding the tax base of the income tax, the committee committee said.

Military pensioners and their survivors pay state and federal income taxes in California, but receive the exemptions from military death benefits paid to qualified survivors, payment for the time, serving in combat areas and partial exemptions from taxes on ownership.

Of the 41 states that have a state income tax, 25 countries completely released military retirement income, and the rest partially releases them.

The State Analyst said California may see a non -monetary value in the proposal: “This will no longer be the only country that fully taxes military retirement income. In this sense, although it is a small financial incentive, the proposal may improve the notion that veterans have from California.”

This article was originally published by CalmattersS