STATEHOUSE (Feb. 28, 2023) – The Indiana House of Representatives recently advanced legislation supported by local legislators that would phase in a complete state income-tax exemption for military pay earned by active-duty members.
State Rep. Jake Teshka (R-South Bend), who co-authored the bill, said unlike active-duty National Guard and reserve members who are exempt from the individual income tax, other active-duty members can qualify for a maximum $5,000 exemption. House Bill 1034, which now moves to the Indiana Senate for consideration, would start with a 25% exemption on military pay in 2024, 50% exemption in 2025, 75% exemption in 2026, and end with a full exemption by 2027.
"This legislation is a great way to honor the brave men and women who serve in our military," Teshka said. "This bill encourages service members to call Indiana home and settle in our great state."
State Rep. Dale DeVon (R-Granger) said Indiana is already facing a skilled labor shortage, with more than 85,000 open job opportunities. He said veterans, with the necessary leadership and technical skills, could help fill these positions and help drive the workforce.
"Our workforce could really benefit from the talented men and women with military experience," DeVon said. "Indiana is a great place to work and live, and we encourage active-duty members to locate here when they leave the service."
Neighboring states including Michigan and Kentucky offer a complete military income tax exemption for residents.
"Our military members deserve to keep as much of their hard-earned money as possible," said State Rep. Tim Wesco (R-Osceola). "Fortunately, our state is in a strong financial position and we can provide this tax relief."
For more information and to follow legislative proceedings, visit iga.in.gov.
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State Rep. Jake Teshka (R-South Bend) represents House District 7,
which includes portions of LaPorte, Marshall and St. Joseph counties.
Click here to download a high-resolution photo.
State Rep. Dale DeVon (R-Granger) represents House District 5,
which includes a portion of St. Joseph County.
Click here to download a high-resolution photo.
State Rep. Tim Wesco (R-Osceola) represents House District 21,
which includes portions of Elkhart and St. Joseph counties.
Click here to download a high-resolution photo.
