"If the article had not been so ridiculously funny, I might have puked."
Oh oh. I am in trouble this morning. So are the other 18,000 people in this state who receive military pensions. It seems like the editorial board for the Star and Sickle has finally found out the 600 page spending bill had a sweetener in it. Finally, after year after year of trying, military pay is now exempt from state tax.
If the article had not been so ridiculously funny, I might have puked. Selfish vets like myself are robbing the state coffers of $23M/year. We excuse me! Or as the kids would say, "that is tough toenails!"
Am I satisfied with this "bonanza" that I will now be receiving? Not really. Not that I am not grateful for my crafty and dedicated friends in the legislature who made this happen. I am very grateful. But the big banana was left unpeeled. And that would be Social Security. And I will now tell you the difference.
Working within the DEERS system (the federal system that vets use for benefits), I was able to get some money escrowed from my military pay to cover both federal and states taxes. So I was able to protect myself from taxes at the end of the year on that portion of my pay. HOWEVER, that is IMPOSSIBLE to do with Social Security. Because so few states tax Social Security benefits, it was not set up for state tax escrow. So each year, every year, seniors in Minnesota get hammered at tax time. At the same time, seniors in other states (like Wisconsin) are living the good life as their Social Security benefits are NOT TAXED.
So yes, we did gain a bit of parity with Wisconsin as well as many other states with the military retirement pay not being taxed. Once we fix Social Security, we will be much closer. We still have the business tax and inheritance tax issue to fix also. Until then, we will just be considered to be a high tax state, unfriendly to seniors, high income earners and businesses.
At least now we can tell veterans they are appreciated and wanted to stay and retire in this state.
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