Is Military Retirement Taxed in Georgia?
As a military veteran, you have dedicated your life to serving your country, and retirement is a well-deserved reward. However, the tax implications of your retirement can be complex and nuanced. In this article, we will explore the question of whether military retirement is taxed in Georgia and what you need to know.
Direct Answer: Is Military Retirement Taxed in Georgia?
Mostly, No
Georgia does not tax military retirement pay for federal military personnel. However, there are some exceptions and additional factors to consider.
Military Retirement Benefits Exempt from Georgia Income Tax
Under Georgia state law, military retirement pay received by a federal military service member is exempt from Georgia state income tax (O.C.G.A. § 48-7-27). This means that you will not have to pay Georgia state income tax on your military retirement benefits.
Exceptions and Considerations
While military retirement pay is generally exempt from Georgia state income tax, there are some exceptions and additional factors to consider:
• National Guard and Reserves: Military retirement benefits received by members of the National Guard and Reserves may be subject to state income tax. This is because their retirement benefits are funded by the state rather than the federal government.
• Dual Military: If you are a member of both the federal military and the Georgia National Guard, you may be required to pay state income tax on your military retirement benefits.
• Other Military Benefits: Other military benefits, such as disability payments, veteran’s benefits, and Survivor Benefit Plan (SBP) payments, may be subject to Georgia state income tax.
Federal Income Tax
It’s important to note that while Georgia does not tax military retirement pay, it is still subject to federal income tax. You will need to report your military retirement benefits on your federal tax return and pay federal income tax on the gross amount of your benefits, minus any deductions and exemptions.
Georgia State Income Tax Deductions
As a military retiree living in Georgia, you may be eligible for certain state income tax deductions and credits. For example:
• Federal Adjusted Gross Income (AGI) Deduction: You may be able to deduct up to $5,000 of your federal AGI from your Georgia taxable income (O.C.G.A. § 48-7-46).
• Military Homeowners Exemption: As a military retiree, you may be eligible for a $2,000 exemption on your primary residence, which can help reduce your property taxes (O.C.G.A. § 48-5-41).
Tables:
Federal Tax Bracket for Single Filers in 2022
| Taxable Income | Marginal Tax Rate |
|---|---|
| $0 – $10,275 | 10% |
| $10,276 – $41,725 | 12% |
| $41,726 – $89,075 | 22% |
| $89,076 – $170,050 | 24% |
| $170,051 or more | 32% |
Georgia State Income Tax Rates
| Taxable Income | Marginal Tax Rate |
|---|---|
| $0 – $5,000 | 1% |
| $5,001 – $10,000 | 2% |
| $10,001 – $20,000 | 3% |
| $20,001 or more | 5.75% |
Conclusion
While military retirement pay is generally exempt from Georgia state income tax, it is important to understand the exceptions and considerations that may apply to your specific situation. Additionally, you will still need to pay federal income tax on your military retirement benefits, and you may be eligible for certain state income tax deductions and credits. It’s a good idea to consult with a tax professional or financial advisor to ensure you are taking advantage of all the tax benefits available to you as a military retiree living in Georgia.
