The Foreign Service Journal, February 2013

THE FOREIGN SERVICE JOURNAL | FEBRUARY 2013 57 AFSA NEWS increase the total to as much as 9.9 percent. CONNECTICUT Pensions and annuities are fully taxable for residents. Social Security is exempt if Federal Adjusted Gross Income is less than $50,000 for singles or $60,000 for joint filers. Statewide sales tax is 6.35 percent. No local additions. DELAWARE Pension exclusions per person: $2,000 is exempt under age 60; $12,500 if age 60 or over. There is an additional standard deduction of $2,500 if age 65 or over if you do not itemize. Social Security income is excluded from taxable income. Delaware does not impose a sales tax. DISTRICT OF COLUMBIA Pension or annuity exclusion of $3,000 is applicable if 62 years or older. Social Security is excluded from taxable income. Sales and use tax is 6 percent, with higher rates for some commodities. FLORIDA There is no personal income, inheritance or gift tax. Florida repealed the “intangibles tax” in 2007. Florida imposes state sales tax and a use tax of 6 percent. Counties impose further taxes from 0.5 to 3.5 percent. GEORGIA $35,000 of retirement income is excluded for those who are 62 years or older, or totally disabled. Beginning in tax year 2012, up to $65,000 of retirement income will be excludable for taxpayers that are 65 or older. Social Security is excluded from taxable income. Sales tax is 4 percent statewide, with additions of up to 3 percent depending on jurisdiction. HAWAII Pension and annuity distri- butions from a government pension plan are not taxed in Hawaii. Social Security is not taxed. Hawaii charges a gen- eral excise tax of 4 percent instead of sales tax. IDAHO If the individual is age 65 or older, or age 62 and disabled, Civil Service Retirement System and Foreign Service Retirement and Disability System pensions only qualify for a deduction in 2012 of up to $27,876 for a single return and up to $41,814 for a joint return. Up to $27,876 may be deducted by the unmarried survivor of the annuitant. The deduction is not available if married filing separately; nor do Federal Employees’ Retirement System or For- eign Service Pension System pensions qualify for this deduction. The deduction is reduced dollar for dollar by Social Security benefits. Social Security itself is not taxed. Idaho state sales tax is 6 percent; some local jurisdictions add as much as another 3 percent. ILLINOIS Illinois does not tax U.S. gov- ernment pensions or Social Security. State sales tax is 6.25 percent. Local additions can raise sales tax to 10.5 percent in some jurisdictions. INDIANA If the individual is over age 62, the Adjusted Gross Income may be reduced by the first $2,000 of any pension, reduced dollar for dollar by Social Security benefits. There is also a $1,000 exemption if over 65, or $1,500 if Federal Adjusted Gross Income is less than $40,000. There is no pension exclusion for survivor annui- tants of federal annuities. Social Security is not taxed in Indiana. Sales tax and use tax in Indiana is 7 percent. IOWA Generally taxable. For 2009 and later tax years, how- ever, a married couple with an income for the year of less than $32,000 may file for exemption, if at least one spouse or the head of household is 65 years or older on Dec. 31, and single persons who are 65 years or older on Dec. 31 may file for an exemption if their income is $24,000 or less. Over age 55, there is a pension/retire- ment income exclusion of up to $6,000 for single, head of household or qualifying wid- ower filers and up to $12,000 for married filing jointly. The same income tax rates apply to annuities as to other incomes. Iowa is phasing out taxation of Social Security benefits, but a portion is still subject to tax in 2012. State- wide sales tax is 6 percent, with no more than 1 percent added in local jurisdictions. KANSAS U.S. government pensions are not taxed. Extra deduc- tion of $850 if over 65. Social Security is exempt if Federal Adjusted Gross Income is under $75,000. State sales tax is 6.3 percent, with additions of between 1 and 4 percent depending on jurisdiction. KENTUCKY Government pension income is exempt if retired before Jan. 1, 1998. If retired after Dec. 31, 1997, pension/annu- ity income up to $41,110 remains fully excludable for 2012. Social Security is exempt. Sales and use tax is 6 percent statewide, with no local sales or use taxes. LOUISIANA Federal retirement benefits are exempt from Louisiana state income tax. There is an exemption of $6,000 of other annual retirement income received by any person age 65 or over. Married filing jointly may exclude $12,000.