Proposed state law would exempt veterans from paying taxes on retirement income

Proposed state law would exempt veterans from paying taxes on retirement

HORRY COUNTY, SC (WMBF) - A change in one law could strengthen the work force, boost the economy and cause hundreds of thousands of people to flock to South Carolina.

That proposed bill, which is currently gaining steam in the statehouse, would amend the S.C. tax code to allow veterans to be exempt from paying state taxes on their military retirement income.

If passed, it would impact the more than 400,000 veterans living in the Palmetto State.

Many of them are known, as they are someone's father, grandfather neighbor or friend.

Some of these men and women, who once served in some aspect in the Armed Forces, now gather at a Florence bowling alley a couple of times a week for a game or two.

These folks hope that the bill being debated in the S.C. Statehouse will roll change into military retirees' pockets.

"The sacrifices the veterans have made, I think would more than warrant or qualify them for tax exempt of their retirement pay," said Rick Walden, a retired sergeant major in the U.S. Army. "What's good for the veterans is good for the county. What's good for the veterans is good for the state."

The bill was first introduced in January 2015. It would change the tax laws in the state and strike out taxing the retirement salaries of those who have served.

"It says that the dollars that you have earned through retirement that if you come back to South Carolina, live in South Carolina, we are not going to tax those dollars," said District 63 Rep. Jay Jordan.

He added it was a no brainer when it came time for him to support the bill.

"I think, first and foremost, it shows respect and appreciation to our service men. I think it also has the ability to be positive for our local and state economy," Jordan said. "Some of these folks that are stationed here temporary in their active service might say let's go back and retire to South Carolina."

The thought behind not garnering state taxes on retired veterans' pensions is that it will cause S.C. to become a more attractive permanent location for vets and their families.

"When you have a competing state that gives incentives, such as no tax on their salary, why would I want to stay in a state that is going  to tax my salary when I can go to  state that doesn't tax it?" said retired Army National Guard member Eddie Collins.

Beyond the nine states that do not have any state income tax, there are 13 boomer states that all said no to taxing military pensions.

Bill supporters said S.C. is missing major income from those vets who choose to head to more military-friendly states to eat, play and live.

"It brings about more disposable income for the veterans for them to spend and invest back into the community because they are going to buy," Walden said. "They are going to buy homes, they are going to buy cars, and they are going to buy food and clothing. The list just goes on and on. We as veterans … see it as a win-win for the state."

Jordan said S.C. is competing against states like Texas, Florida, Tennessee and North Carolina when it comes to enticing veterans and their families to make a move.

Plus, more veterans in the state could prove to be an added boost to the workforce.

"I was trained as a legal specialist in the Army. I had other skills that I was trained in the Army for as well," Walden said. "I went to work for the 12th Judicial Circuit in South Carolina; they didn't have to train me."

Walden added other skills the Army instilled in veterans included supply, electronics, automation and more.

Doctors, nurses, the military has been training them already," he said. "Some of them will have to be recertified to meet state requirements, but for the most part the training is done."

The bill previously passed the state House. It is now in a Senate finance committee.

It is expected to head to the governor's desk soon.

Copyright 2016 WMBF News. All rights reserved.