Military retirees in Ohio--Now No Taxes on Retirement Pay

[samclem]

I got the below email today from the head of the Air Force Association in Ohio.
I can't say I'm in favor of it (hey, what about the retirement checks received by GM workers, firemen, teachers. etc? Are they tax-free, too?).
But, a lot of other states do this, and Ohio will still be getting money from us.

********************************************

It is indeed an honor and pleasure to inform you that at noon today I had the opportunity to represent each member of the Air Force Association across Ohio as Governor Ted Strickland signed into law House Bill 372 that allows tax exemption of military retirement pay, along with other benefits.

This landmark legislation was championed by a by-partisan group of Ohio legislators from both the Senate and House of Representatives. Leading this effort was State Senator Larry Cates, Senator Steve Austria, Senator Ron Amstutz, Speaker of the House Jon Husted, Representative Ross McGregor, Representative Pete Ujvagi, and many others.

We owe a debt of gratitude to the entire Ohio General Assembly for their recognition of the importance of this legislation and the speed in which they moved it through both chambers and on to the governor. Governor Strickland is to be commended for his leadership, vision, and speed which he demonstrated in signing it into law today.

Numerous organizations across Ohio joined with the Air Force Association in supporting and testifying on behalf of this bill. Significant leadership was provided by the Dayton Area Chamber of Commerce, among others.

Thanks also to those of you who reached out to your elected officials in support of this legislation. Your efforts paid off today and in the future for all Ohioans as we reap the benefits of keeping those military members, the best and brightest our nation has to offer, here in Ohio.

Sincerely,

John W. McCance
President
Air Force Association
State of Ohio
2406 Hillsdale Dr
Beavercreek, OH 45431

 

[Khan]

Were all the military retirees threatening to leave Ohio?

 

[samclem]

Were all the military retirees threatening to leave Ohio?

No. The backers claimed that people finishing a military career were leaving Ohio rather than retire here. This was hurting the state because of the loss of spending from these folks and also because lots of contractors need/want to hire these people with recent military experience.

When I retired, one of the counselors doing the paperwork looked at me like I was crazy for staying, and reminded me again that Ohio would tax my retirement pay. In the grand scheme of things, if a guy can get a lucrative contracting job in Ohio and likes it here, he'd be shortsighted to leave just because of this tax on his retired pay--for most people it probably comes to less than $1000 per year. Now, for somebody that's ONLY getting military retirement pay, a non-taxing state might look a lot better.

 

[jIMOh]

if the politicans changed the weather climate, I bet they would find those retirees would not have left the state.

That and the state income tax here seems to bite me harder than the federal.

I get 4 figures back from federal each year, yet owe the state more each year. Each year we withhold more in state taxes, and take out less in federal, yet we owe more to state when we file than we did the previous year. It has gotten to point we stop adjusting state withholding and just pay the bill from the federal refund. I'd prefer to net zero on the tax return, but Ohio taxes do not appear to be that simple to predict.

 

[beowulf]

At least Ohio is better than Virginia. A few years ago, there was a federal court decision that said states that exempt state pensions from tax had to apply the same treatment to federal and military pensions. Many states that provided that exemption applied it to all government pensions. Virginia chose the opposite tactic - they simply eliminated the exemption for state employees so everyone would have to pay.

But that alone is still not a reason to leave the state. In my opinion, there has to be a lot more than that.

 

[OAG]

I am starting to wonder about this thread and the purported e-mail from the AF Association President. I have not been able to find any information besides this on the legislation. Anyone have any further information like effective date and other details?

 

[JDARNELL]

I was stationed in Ohio once. Thought it was the best place ever til I went to Colorado. That kind of put it in perspective. Looking back being in Dayton was the longest 2 1/2 yrs of my life. Its all relative I guess.

Tomcat98

 

[UncleHoney]

I am starting to wonder about this thread and the purported e-mail from the AF Association President. I have not been able to find any information besides this on the legislation. Anyone have any further information like effective date and other details?

There wasn't much about it in the Dispatch or on local TV. The Toledo Blade has the story.

toledoblade.com -- Ohio won't tax military pensions; Strickland vows exemption costing $30M

 

[UncleHoney]

I was stationed in Ohio once. Thought it was the best place ever til I went to Colorado. That kind of put it in perspective. Looking back being in Dayton was the longest 2 1/2 yrs of my life. Its all relative I guess.

Tomcat98

When you retire you'll have to move back to Ohio so you can enjoy those extra long years we have.

 

[OAG]

UH: Yes, I was able to find one of the actual bills and found the information along with the effective date which is 1 Jan 2008 and beyond.

 

[beowulf]

UH: Yes, I was able to find one of the actual bills and found the information along with the effective date which is 1 Jan 2008 and beyond.

That's great - thank you. Maybe this will spread to other states. Even though most military pensions are relatively small, it all helps.

 

[JDARNELL]

When you retire you'll have to move back to Ohio so you can enjoy those extra long years we have.

Something like that

 

[JPatrick]

Missouri has done the same thing, and included exemption of social security.
All of this will be phased over 5 years and I believe some teachers/fire/police may be included.
There are income limits, but they are quite high.
An unexpected bonus for this recent arrival

A study is underway looking at the total elimination of the income tax. If implemented, the shortfall would be made up by increased sales tax. I'm not holding my breath on this one.

 

[djhartmannn]

You need to think of attracting military retirees as a kind of industry.

Illinois for one example lures retirees into the state with free state eductions up to a Batchelors degree. I just retired from the military and I did look at taxation as part of my decision. Every retiree that can be lured in will put thousands of dollars into the Ohio economy over the rest of their years. They also bring skills to the workforce and are typically pretty well behaved neighbors. I think any dime spent or lost in getting military retirees here is good money invested and is payed back to the rest of the Ohio'ns many times over ... at least until we get sick of the winters and move to Florida.

 

[haha]

You need to think of attracting military retirees as a kind of industry.

Illinois for one example lures retirees into the state with free state eductions up to a Batchelors degree. I just retired from the military and I did look at taxation as part of my decision. Every retiree that can be lured in will put thousands of dollars into the Ohio economy over the rest of their years. They also bring skills to the workforce and are typically pretty well behaved neighbors. I think any dime spent or lost in getting military retirees here is good money invested and is payed back to the rest of the Ohio'ns many times over ... at least until we get sick of the winters and move to Florida.

Why not make all millionaire retirees tax exempt? They will

put thousands of dollars into the Ohio economy over the rest of their years.

 

[Bestwifeever]

...Illinois for one example lures retirees into the state with free state eductions up to a Batchelors degree. ....

Don't move to Illinois expecting free state education--veterans can have tuition waived only if they meet all of these qualifications:

a. Must have been a legal resident physically residing in Illinois within six months prior to entering the Armed Forces of the United States; and
b. Must have physically returned to Illinois and established residency within six months of leaving such service; and​

c. Must reside in Illinois unless he/she is a member of the Armed Forces of the United States at the time of enrollment in school

(Wow this is an old thread)

 

[Nords]

Don't move to Illinois expecting free state education--veterans can have tuition waived only if they meet all of these qualifications

When I was on active duty in the 1990s, just about every one of our Illinois-resident submariners got out at the end of their contracts to go to college. Our re-enlistment coordinator wouldn't even waste his time trying to change their minds.

Then if they really felt like it they could return to the submarine force as officers. Strangely, that never seemed to happen...

 

[BLS53]

When I was on active duty in the 1990s, just about every one of our Illinois-resident submariners got out at the end of their contracts to go to college. Our re-enlistment coordinator wouldn't even waste his time trying to change their minds.

Then if they really felt like it they could return to the submarine force as officers. Strangely, that never seemed to happen...

One could "work the system" with that Illinois plan. I can't speak for the new G. I. Bill, but the old Vietnam Era one was fairly generous monthly check wise. Especially with the state of Illinois picking up the tuition. I know a retired Chief who moved in with his elderly mother, and went to the local community college for about 6 years. Apparently, multiple Associate Degrees are allowed (or were) under both the Illinois and VA rules. I think he ended up with 2 of 'em, and maybe a certificate in a trade also. The combined retirement and VA income, plus minimal expenses, provided a fairly decent lifestyle. His mom died soon after that, and left him a sizable inheritance. He hasn't been in the workforce since age 39, and has never held a civilian job to my knowledge.

I talked to him a few years ago, and he was excited about getting SS when he turns 62.

I suppose ER planning comes in all shapes and sizes.

 

[deserat]

I was stationed in Ohio once. Thought it was the best place ever til I went to Colorado. That kind of put it in perspective. Looking back being in Dayton was the longest 2 1/2 yrs of my life. Its all relative I guess.

Tomcat98

Hahahaha - yes, it does put things into perspective - like Minot versus Dayton or Thule versus Boston.....

I used to go to Dayton quite often as that is where I was assigned for Reserves. Worst part was trying to fly out during snow storms and getting stuck in Chicago......

Colorado is beautiful, but if they keep voting in more entitlements, they'll end up like CA, a beautiful, broke state.

 

[samclem]

Hahahaha - yes, it does put things into perspective - like Minot versus Dayton or Thule versus Boston.....

I used to go to Dayton quite often as that is where I was assigned for Reserves. Worst part was trying to fly out during snow storms and getting stuck in Chicago......

Colorado is beautiful, but if they keep voting in more entitlements, they'll end up like CA, a beautiful, broke state.

One of the advantages of a military career is getting the "opportunity" to sample a lot of different places. We were stationed in FL and didn't care for it a bit (TDH!). Colorado was very nice, but we think Dayton is the best place we've been as far as a spot to retire. My sis, who lives in CA, can't believe it and thinks the weather here must be like Siberia. Hey, there's something for everyone.

 

[martyb]

One of the advantages of a military career is getting the "opportunity" to sample a lot of different places. We were stationed in FL and didn't care for it a bit (TDH!). Colorado was very nice, but we think Dayton is the best place we've been as far as a spot to retire. My sis, who lives in CA, can't believe it and thinks the weather here must be like Siberia. Hey, there's something for everyone.

Back in the late 80's, I came real close to transferring to Dayton, as a federal employee. I had a job lined up at Wright-Patterson AFB. In the end, I decide to stay in Austin, TX instead. Just a few yrs later, my base in Austin was closed & I had to relocate to Louisiana.

 

[friar1610]

Count me as a military retiree who would prefer that states exempt active duty military pay rather than that of retirees. (I understand that this doesn't accomplish the same objective for the states.) But it strikes me that something is wrong if a state taxes active duty pay but exempts retired pay. (I don't know that this is the case with Ohio or Illinois; just sayin'....)

 

[Nords]

Hawaii wasn't our first choice when we were sent here, but it quickly became our only choice.

I don't miss the 102-degree days in Charleston, SC or the sub-zero days in Pittsburgh. Ballston Spa, NY and New London, CT are forever memorable as frozen blasted wastelands. I don't ever want to experience Adak's 70-mph snowfalls again. I'll never miss the five-hour surface transits out of Scotland to the North Atlantic, or the hair-raising transit up the Cooper River, or the waterborne fogged-in multi-lane superhighway rush hour in the Straits of Juan de Fuca, or the incredible smells of Olongapo in Subic Bay.

Heck, spouse and I can't even handle temps in the 50s anymore.

 

[deserat]

One of the advantages of a military career is getting the "opportunity" to sample a lot of different places. We were stationed in FL and didn't care for it a bit (TDH!). Colorado was very nice, but we think Dayton is the best place we've been as far as a spot to retire. My sis, who lives in CA, can't believe it and thinks the weather here must be like Siberia. Hey, there's something for everyone.

Oh, samclem, you are one of my favorite posters and I didn't mean to insult you - I didn't mind Ohio so much. I looked like a fairly good place to raise children - Midwest values and all. I loved going to the Gorge area and going hiking and having breakfast at the mill out there - and Yellow Springs has a great restaurant called "The Winds." Also, WPAFB is a large base which has all of the amenities and more. However, I grew up in Arizona and wasn't too fond of the cold - last time I was in Ohio, they had a blizzard that closed down the base - I still walked from the VOQ to the HQ building in the blizzard as I didn't know that they had closed down the base and I was supporting a 3-star at the time. They don't sleep or quit working

Now I live in Germany and it's as or even colder than Ohio - sigh - I do dream of warm weather at times. The best part out here is I get to snow ski a lot more easily. And the Weinachtmarkts with Gluhwein......and all of the other fests and volksmarches, but I digress from the original topic too much.

 

[braumeister]

SamClem hit the nail on the head. Being in the military was a fantastic way to see the world and compare possible retirement places.

I was stationed long-term in New York (Syracuse and NYC), Ohio (Dayton), California (Los Angeles and Monterey), Florida (Panama City), Illinois (Belleville), Colorado (Colorado Springs and Denver), Washington DC and Alabama (Montgomery), Brazil, and Vietnam (in no particular order)
I was TDY for at least a couple of weeks in another half-dozen states, and four foreign countries.
I also was TDY for at least a couple of days in 6 or 7 other states and a couple of more countries.

I'm an inveterate traveler, so I also spent a lot of vacation time on the road. I've been to all 50 states and 14 other countries.

I had plenty of ideas about places to retire, but you know, sometimes you get surprised. In my case, I met someone who captured my heart, and had lived all her life in southwestern Ohio. I thought that was a decent area, and we've been here together for the last 21 years. Honestly, it's about as far south as I would ever want to live (gets pretty hot in the summer), but the cost of living is comparatively low, and we love our modest little house and its location.