EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*sb0346*
SENATE BILL 346
Q3 4lr2217
By: Senators Elfreth, Bailey, Beidle, Brooks, Carozza, Charles, Feldman, Folden,
Gallion, James, King, Klausmeier, Kramer, Lam, McKay, Muse, Ready,
Salling, Simonaire, and West
Introduced and read first time: January 15, 2024
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Income Tax – Subtraction Modification – Military Retirement Income 2
(Keep Our Heroes Home Act) 3
FOR the purpose of phasing in, over a certain period of years, an increase in a subtraction 4
modification under the Maryland income tax to allow for a subtraction modification 5
of all military retirement income; and generally relating to a subtraction 6
modification under the Maryland income tax for military retirement income. 7
BY repealing and reenacting, without amendments, 8
Article – Tax – General 9
Section 10–207(a) 10
Annotated Code of Maryland 11
(2022 Replacement Volume and 2023 Supplement) 12
BY repealing and reenacting, with amendments, 13
Article – Tax – General 14
Section 10–207(q) 15
Annotated Code of Maryland 16
(2022 Replacement Volume and 2023 Supplement) 17
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 18
That the Laws of Maryland read as follows: 19
Article – Tax – General 20
10–207. 21
(a) To the extent included in federal adjusted gross income, the amounts under 22
this section are subtracted from the federal adjusted gross income of a resident to determine 23 2 SENATE BILL 346
Maryland adjusted gross income. 1
(q) (1) (i) In this subsection the following words have the meanings 2
indicated. 3
(ii) “Military retirement income” means retirement income, 4
including death benefits, received as a result of military service. 5
(iii) “Military service” means: 6
1. induction into the armed forces of the United States for 7
training and service under the Selective Training and Service Act of 1940 or a subsequent 8
act of a similar nature; 9
2. membership in a reserve component of the armed forces of 10
the United States; 11
3. membership in an active component of the armed forces of 12
the United States; 13
4. membership in the Maryland National Guard; or 14
5. active duty with the commissioned corps of the Public 15
Health Service, the National Oceanic and Atmospheric Administration, or the Coast and 16
Geodetic Survey. 17
(2) The subtraction under subsection (a) of this section includes: 18
[(i) if, on the last day of the taxable year, the individual is under the 19
age of 55 years, the first $12,500 of military retirement income received by an individual 20
during the taxable year; and 21
(ii) if, on the last day of the taxable year, the individual is at least 55 22
years old, the first $20,000 of military retirement income received by an individual during 23
the taxable year.] 24
(I) FOR A TAXABLE YEAR B EGINNING AFTER DECEMBER 31, 25
2023, BUT BEFORE JANUARY 1, 2025, THE FIRST $20,000 OF MILITARY RETIREME NT 26
INCOME RECEIVED BY A N INDIVIDUAL DURING THE TAXABLE YEAR ; 27
(II) FOR A TAXABLE YEAR B EGINNING AFTER DECEMBER 31, 28
2024, BUT BEFORE JANUARY 1, 2026, THE GREATER OF $20,000 OR 50% OF THE 29
AMOUNT OF MILITARY R ETIREMENT INCOME REC EIVED BY AN INDIVIDU AL DURING 30
THE TAXABLE YEAR ; AND 31
(III) FOR A TAXABLE YEAR B EGINNING AFTER DECEMBER 31, 32 SENATE BILL 346 3
2025, ALL MILITARY RETIREM ENT INCOM E RECEIVED BY AN IND IVIDUAL DURING 1
THE TAXABLE YEAR . 2
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 3
1, 2024. 4