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Old 01-31-2012, 02:23 PM
 
36 posts, read 60,208 times
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Just for my planning purposes can anyone tell me if the State of Oregon taxes military retirement pay?
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Old 01-31-2012, 03:46 PM
 
Location: Arizona
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My husband is retired Navy and yes, we did have to claim his retirement pay on the state taxes.
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Old 01-31-2012, 04:20 PM
 
Location: Portland, Oregon
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There is an exemption for the portion of a Federal pension earned before 1991.

Oregon does have favorable treatment for seniors. Health care expenses are in addition to the Federal itemized deductions for those 62.
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Old 02-01-2012, 03:27 PM
 
Location: Arizona
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Federal Civil Service Pension Exclusion:

Income attributable to service before October 1991 is exempt. In addition 62+: 9% credit for retirement income Income limits apply

Military Pension Exclusion 62+: 9% credit for retirement income. Income limits apply

You can find this here: http://www.ncsl.org/documents/fiscal/TaxonPensions2011.pdf
The above was on page 14.
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Old 02-15-2012, 09:45 AM
 
36 posts, read 60,208 times
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Quote:
Originally Posted by lauramc27 View Post
Federal Civil Service Pension Exclusion:

Income attributable to service before October 1991 is exempt. In addition 62+: 9% credit for retirement income Income limits apply

Military Pension Exclusion 62+: 9% credit for retirement income. Income limits apply

You can find this here: http://www.ncsl.org/documents/fiscal/TaxonPensions2011.pdf
The above was on page 14.

So if my military retirement is based on service from 1973 to 1994, the majority of my military retirement will be exempt from state tax as it was earned before 1991? Am I correct in that?
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Old 02-16-2012, 02:44 PM
 
Location: Arizona
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Quote:
Originally Posted by Coastie3202 View Post
So if my military retirement is based on service from 1973 to 1994, the majority of my military retirement will be exempt from state tax as it was earned before 1991? Am I correct in that?
You may want to talk to a CPA to confirm the information, but based on the link I provided it would seem that the only amount that should be taxed is from November 91 forward.
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Old 02-19-2012, 07:13 PM
 
Location: Portland, Oregon
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You don't need a CPA to figure it out. If you use TurboTax add the Oregon return and take it for a spin. I suppose that other tax software products will do the same. The advantage of software is that you can play 'what-if' to your heart's content.

Another option would be to wait until tax season is over and seek out an Oregon tax preparer (my brother has used a gal in Oregon City for years), send them him/her Federal return and info on the dates your military pension covers and ask him/her to prepare a mock Oregon tax return.

My personal preference is software.
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Old 02-19-2012, 07:30 PM
 
Location: Florida
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I just had my taxes done. As far as the pensions it is based on 1991 and forward. Anything before 1991 is not taxed.
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Old 09-18-2013, 11:42 PM
 
Location: Phoenix, AZ
3 posts, read 8,723 times
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Default You are Incorrect

"
Quote:
Originally Posted by Jimrob1 View Post
I just had my taxes done. As far as the pensions it is based on 1991 and forward. Anything before 1991 is not taxed.
"



Oregon Revenue Office sent me information that the reverse of what you stated. I provide their address and a quote of their information below;

Revenue Building
Tax Help, Room 135
955 Center St., NE
Salem, OR 97310
In state: (800) 356-4222
Out of state: (503) 378-4988

[SIZE=2]General Information on Military and Federal Active and Retired Income: [/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]Military members (that's active duty) who are legal residents are taxed using federal income tax rules. (Note: Certain exemptions apply). Nonresident military members who receive nonmilitary income from an in-state source must file. Military income is not used when computing tax on nonmilitary income. [/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]According to a State Supreme Court ruling, eligible federal retirees, including military personnel, no longer have to pay Oregon tax on their federal pension (military retired pay). [/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]Retirees who worked for the federal government prior to Oct. 1, 1991, but who did not retire until after that date, must continue to pay taxes on the portion of their federal pension attributable to federal service after Oct. 1, 1991. [/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]Retirement income credit allowed on all retirement income of retirees age 61 or older on Dec. 31, 1998. The ability to claim the credit also is dependent on taxpayer's household income and the amount of Social Security income received. (In other words if your military pension and social security go over a certain limit, after exemptions tax may be due).[/SIZE]

What confuses many people especially new comers to the state is the part that speaks to paying income tax after 1 Oct, 1991. If you read above it clearly states that the requirement to pay tax is based on already earning it in the state and paying it in the past up to the Oct 1991 date as well as being a resident and/or earning after the date.

If you never paid prior or were not a resident until after Oct 91' then it indicates you may not be required to pay based on the Supreme Court ruling but as others have stated verify that with a knowledgeable CPA or the state revenue office.

I also learned that since I have never lived in Oregon ever and will not reside there until age 62 in another year when I move there that both my military pension and my social security income will both be exempt, whereas if I had moved to the state and established residency before age 62 there would have been an income threshold I had to meet so that combined retirement income over a certain amount would result in tax being due to Oregon. But since I will not move there until after age 62 all of my retired military and social security income is exempt so long as it does not go over a certain amount.

I currently reside in a Southwestern state that does tax my pension heavily and also denies me un-employment because I draw a pension yet requires me to pay into the state unemployment fund. So I will be moving to Oregon just as soon as I can.
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Old 09-19-2013, 02:45 PM
 
Location: Dallas, Oregon & Sunsites Arizona
8,000 posts, read 15,473,322 times
Reputation: 2807
You need to fix the mess you made with that post. Also why not ask a professional instead of a forum?
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