DENVER – As a combat veteran, Colorado State Senator Larry Crowder (R-Alamosa) knows all too well the challenges facing his fellow military veterans. That’s why the first bill he offered in the 2016 legislative session, SB-001 — which is also the first bill being introduced by the Senate — aims at eliminating current caps on how much military retirees are able to deduct from federal taxable income.
“I believe this bill will benefit our military retirees immensely,” said Crowder, who has earned high marks for his support for veterans at the Capitol. “It is a small token that our state can give back for their years of service.”
“That we introduced this bill first speaks not only to the gratitude all Coloradans feel toward those who serve our country in uniform, but to our commitment, as Republicans, to focus on passing measures that will make a meaningful difference in the lives of everyday Coloradans,” said Senate President Bill Cadman.
The initial point for defining state income tax liability is federal taxable income. This number is adjusted for additions and subtractions, or deductions, which are used to determine Colorado taxable income, which amount is multiplied by the state’s 4.63% income tax rate. Currently, veterans between 55 and 64 years old may deduct up to $20,000 of their military retirement benefits from federal taxable income, and a veteran who is 65-plus years may deduct up to $24,000.
Senate Bill-001 eliminates these caps and allows a veteran to claim a state income tax deduction for all military retirement benefits.
Crowder will not benefit from the bill as he is not a military retiree.
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