Indiana’s 12,000 national guard soldiers won’t owe state income taxes on military pay beginning this tax season — a move approved in the spring but which Gov. Eric Holcomb lauded anew on Monday.
“By completely phasing out state taxes on military veteran retirement in 2022 and eliminating the state income tax for Hoosier Guardsmen in 2023, Indiana continues to demonstrate our state’s enduring appreciation for the exemplary women and men who serve our local communities, state and nation in the Indiana National Guard,” Holcomb said in a news release.
House Enrolled Act 1034 allows national guard soldiers and military reservists to deduct military wages from the adjusted gross income used to calculate income tax liability. Dual-status military technicians are included, according to an Indiana Department of Revenue bulletin.
Hoosier members of the armed forces will enjoy a similar exemption starting with 2024 income, as laid out in the bill.
Lawmakers approved the legislation in late April and Holcomb signed it into law on the first day of May. Veterans groups had pushed for the change for years.
Maj. Gen. Dale Lyles, Indiana’s adjutant general, also celebrated the move.
“I’m grateful for Gov. Holcomb’s and the legislature’s meaningful support for Hoosier Guardsmen through this exemption from state income tax,” Lyles said. “Soldiers and airmen in our many uniquely rewarding careers will enjoy the additional benefit of keeping more of what they earn while serving our state and nation.”