Bill > HB2050

This bill provides a state income tax exemption for certain veterans receiving federal retirement pay or pension from their military service. Specifically, the bill allows veterans who are either disabled (having a 100% disability rating from the U.S. Department of Veterans Affairs) or members of reserve components or the National Guard to subtract their federal military retirement pay or pension from their federal taxable income. The bill defines "Armed Forces of the United States" broadly to include regular and reserve components of the Army, Navy, Air Force, Marine Corps, Coast Guard, and Space Force, as well as the National Guard. Importantly, the subtraction cannot exceed the total retirement pay or pension received, and it cannot include any amounts already subtracted under another existing tax provision. The tax exemption will apply to tax years beginning on or after January 1, 2026, giving taxpayers and the Department of Revenue time to prepare for the new regulation. The bill aims to provide financial relief for veterans who have served their country, particularly those with disabilities or ongoing military commitments.

Budget and Finance, Military Affairs and Security

https://olis.oregonlegislature.gov/liz/2025R1/Measures/Overview/HB2050