SB 69

For taxable years beginning after December 31, 2018, this bill exempts from

taxation all military income received from the federal government each year by an

individual who is on active duty in the U.S. armed forces. Current law exempts from

income taxation all military income received from the federal government by a

member of a reserve component of the U.S. armed forces who is called into active

federal service or special state service, for the period of time during which the

member is on active duty.

Under current law, the armed forces member tax credit allows an active duty

member of the U.S. armed forces to claim a nonrefundable individual income tax

credit of up to $300 in military income received each year from the federal

government for services performed while the claimant is stationed outside of the

United States. Because the credit is nonrefundable, no amount will be paid to the

claimant by check if the credit he or she is due exceeds his or her tax liability. Under

this bill, no new claims may be made for the credit for taxable years that begin after

December 31, 2018.

Because this bill relates to an exemption from state or local taxes, it may be

referred to the Joint Survey Committee on Tax Exemptions for a report to be printed

as an appendix to the bill.