§ 6-3-2-4 — Military service deduction; retirement income or survivor's benefits deduction

Indiana § 6-3-2-4

• Jurisdiction: Indiana
• Art. 3: STATE INCOME TAXES
• Ch. 2: Imposition of Tax and Deductions

Text

Note: This version of section effective until 7-1-2025. See also
following version of this section, effective 7-1-2025.
Sec. 4. (a) Each taxable year, an individual, or the
individual's surviving spouse, is entitled to the following:
(1) An adjusted gross income tax deduction for the first five
thousand dollars ($5,000) of income, excluding adjusted gross
income described in subdivision (2), received during the taxable
year by the individual, or the individual's surviving spouse, for the
individual's service in an active or reserve component of the
armed forces of the United States, including the army, navy, air
force, space force, coast guard, marine corps, merchant marine,
Indiana army national guard, or Indiana air national guard, or the
United States Public Health Service Commissioned Corps or the
National Oceanic and Atmospheric Administration
Commissioned Officer Corps.
(2) An adjusted gross income tax deduction for income from
retirement or survivor's benefits received during the taxable year
by the individual, or the individual's surviving spouse, for the
individual's service in an active or reserve component of the
armed forces of the United States, including the army, navy, air
force, space force, coast guard, marine corps, merchant marine,
Indiana army national guard, or Indiana air national guard, or the
United States Public Health Service Commissioned Corps or the
National Oceanic and Atmospheric Administration
Commissioned Officer Corps. The amount of the deduction is the
lesser of:
(A) the benefits included in the adjusted gross income of the
individual or the individual's surviving spouse; or
(B) six thousand two hundred fifty dollars ($6,250) plus the
following:
(i) For taxable years beginning in 2019, twenty-five percent
(25%) of the amount of the benefits in excess of six thousand
two hundred fifty dollars ($6,250).
(ii) For taxable years beginning in 2020, fifty percent (50%)
of the amount of the benefits in excess of six thousand two
hundred fifty dollars ($6,250).
(iii) For taxable years beginning in 2021, seventy-five percent
(75%) of the amount of the benefits in excess of six thousand
two hundred fifty dollars ($6,250).
(iv) For taxable years beginning after 2021, one hundred
percent (100%) of the amount of the benefits in excess of six
thousand two hundred fifty dollars ($6,250).
(b) An individual whose qualified military income is subtracted
from the individual's federal adjusted gross income under IC 6-3-1-3.5(a)(18) for Indiana individual income tax purposes is not, for
that taxable year, entitled to a deduction under this section for the same
qualified military income that is deducted under IC 6-3-1-3.5(a)(18).
As added by Acts 1977, P.L.78, SEC.3. Amended by
P.L.76-1985, SEC.2; P.L.144-2007, SEC.5; P.L.6-2012, SEC.49;
P.L.250-2015, SEC.16; P.L.217-2017, SEC.64; P.L.214-2018(ss),
SEC.7; P.L.162-2019, SEC.1; P.L.58-2025, SEC.2.