ANNAPOLIS, MD — Governor Wes Moore yesterday testified in support of The Keep Our Heroes Home Act, presented as House Bill 554 before the House Ways and Means Committee, marking the first time a sitting governor has testified in support of a bill since 2014. The act is a major component of the governor’s legislative agenda to support veterans and their families.
“Maryland’s veterans start small businesses, serve on boards, and bring their talents to companies that are driving Maryland’s economy forward,” said Governor Moore. “These public servants start families, make friends, and build their lives here in Maryland—and yet we’re losing them to other states. I believe that this legislation stands to be among the most impactful that you will consider this session.”
The Keep Our Heroes Home Act expands the military retirement tax exemption to $25,000 for all recipients in tax year 2023 and to $40,000 in tax year 2024 and each year thereafter. Current law allows any individual receiving military retirement (including surviving spouses) to deduct the first $5,000 from their taxable income if they are under the age of 55 and $15,000 from their state taxable income if they are 55 years of age or older. This bill eliminates the age distinction and expands the tax exemption for any veteran or surviving spouse receiving this retirement income.
Thirty-six states do not tax military retirement income at all, including neighboring West Virginia and Pennsylvania. The tax exemption set forth in the legislation will save Maryland veterans an estimated $30 million annually beginning in tax year 2024.
The bipartisan legislation is cosponsored by a majority of the Maryland Senate, including eleven Republicans. In the House, 69 Delegates are cosponsors, including fourteen Republicans. The Senate Majority Leader has signed on to the bill, as have the Minority Leaders in both the House and the Senate.