HOUSE BILL No. 1024
DIGEST OF INTRODUCED BILL
Citations Affected: IC 6-3-2-3.7.
Synopsis: Taxation of civil service annuities. Provides a 100% income
tax deduction, beginning in 2014, for federal civil service annuity
income received by an individual or the individual's surviving spouse.
Phases in the deduction from 2010 through 2013.
Effective: January 1, 2010 (retroactive).
January 5, 2010, read first time and referred to Committee on Ways and Means.
Second Regular Session 116th General Assembly (2010)
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HOUSE BILL No. 1024
A BILL FOR AN ACT to amend the Indiana Code concerning
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 6-3-2-3.7; (10)IN1024.1.1. -->
SECTION 1. IC 6-3-2-3.7 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JANUARY 1, 2010 (RETROACTIVE)]:
Sec. 3.7. (a)
Each taxable year, an individual or the individual's
surviving spouse who receives income from a federal civil service
is entitled to an adjusted gross income tax deduction.
the remainder of:
(1) the first two thousand dollars ($2,000) which is received by
the individual during the taxable year from a federal civil service
annuity, and which is included in adjusted gross income under
Section 62 of the Internal Revenue Code; minus
(2) the total amount of social security benefits and railroad
retirement benefits received by the individual during the taxable
However, the individual is only entitled to the deduction provided by
this section if the individual is at least sixty-two (62) years of age
before the end of the taxable year.
(b) For a taxable year beginning after 2013, the amount of the
deduction is one hundred percent (100%) of the federal civil
service annuity received during the taxable year and included in
adjusted gross income under Section 62 of the Internal Revenue
(c) For a taxable year beginning in 2010 through 2013, the
amount of the deduction is equal to the result determined under
STEP FOUR of the following formula:
STEP ONE: Determine the amount of the federal civil service
annuity received by the individual or the individual's
surviving spouse during the taxable year and included in
adjusted gross income under Section 62 of the Internal
STEP TWO: Multiply:
(A) the STEP ONE result by:
(B) for the taxable year beginning in:
(i) 2010, twenty percent (20%).
(ii) 2011, forty percent (40%).
(iii) 2012, sixty percent (60%).
(iv) 2013, eighty percent (80%).
STEP THREE: Determine the lesser of the following:
(A) The STEP ONE result.
(B) Twelve thousand dollars ($12,000).
STEP FOUR: Determine the greater of the following:
(A) The STEP TWO result.
(B) The STEP THREE result.
SOURCE: ; (10)IN1024.1.2. -->
SECTION 2. [EFFECTIVE JANUARY 1, 2010 (RETROACTIVE)]
IC 6-3-2-3.7, as amended by this act, applies only to taxable years
beginning after December 31, 2009.
SOURCE: ; (10)IN1024.1.3. -->
SECTION 3. An emergency is declared for this act.