Over the next five years, the U.S. Armed Services will downsize our military forces by 350,000. These Americans have skills that make them valuable to Iowa businesses and communities. Attracting them to our state will bring workers who can help grow our economy and expand our middle class.
To encourage more veterans to make Iowa their home, the Legislature approved the Home Base Iowa Act (Senate File 303). The centerpiece of the bill makes military retirement pay exempt from state individual income taxes starting this year. Those who are eligible for the tax exemption have given 20 or more years of military service to our country.
Iowa currently exempts the first $6,000 (single) and $12,000 (married) of a veteran's qualified retirement income from state taxes. To qualify, the taxpayer must be at least 55 or disabled. Twenty-six other states already exempt all military retirement pay. By joining them, we're cutting taxes for at least 7,765 Iowa veterans.
Other benefits to veterans in SF 303 include:
Allowing private employers to grant a preference in hiring and promotion to veterans, and to the spouses of disabled veterans or service members who died because of active duty.
Providing a clear pathway to jobs by matching military occupational training to Iowa's professional and occupational licensure requirements.
Encouraging Iowa's colleges and universities to grant educational credits to veterans for military education, training and experience.
Expanding eligibility and financing options for the Military Home Ownership Assistance Program.
Providing special license plates for military service to veterans and service members free of charge.
Clarifying that war veteran properties, such as Veterans of Foreign Wars halls, will not lose their tax-exempt status if they rent their facilities for $250 or less and proceeds are used for the purposes of the veterans' organization.
Studying the feasibility of expedited licensing, certification or registration of military spouses if they have an occupational or professional license from another state.