Abe Hamadeh Introduces Bills Making Military and Veterans' Pay Tax-Free

Representative Abe Hamadeh (R-AZ) has introduced two pieces of legislation keeping military and veterans' retirement pay tax-free.

The first, named the Service Members Tax Relief Act, applies to all active-duty and reserve servicemembers, not only exempting their pay from income taxes but also extending to enlistment, retention, and education bonuses, as well as special and incentive pays for service members in all eight of the Federal Uniformed Services.

The second, the Tax Cuts for Veterans Act, amends Section 122 of the Internal Revenue Code to exclude all military retirement pay and related veterans' benefits from federal income taxes, including retirement and retainer pay outlined in Titles 10, 14, 37, and 38.

"These bills are in keeping with my commitment to America First principles and advances President Trump's Peace Through Strength agenda by alleviating the burdens on our service members in some small measure," said Rep. Hamadeh in a press release. "Our service members face high operational demands and cost-of-living pressures that outpace pay tables. So, anything we can cost-effectively do to ease those pressures should be done."

Rep. Hamadeh further emphasized that the bills are " fiscally conservative in that they offer relief through the tax code instead of new spending," and thus are "a win-win; the exemption instantly improves take-home pay, while helping with recruitment and retention, which in turn keeps our war fighters strong."

Senator Pete Ricketts (R-NE), who is introducing the bill in the Senate, expressed that "our servicemembers and veterans sacrifice for the country. We owe them more than we can ever repay."

"That's why I'm working to ensure these brave women and men keep all the benefits they earn during military service," Sen. Ricketts continued. "We also need to make sure that service members are set up for success when they transition back to civilian life. These bills strengthen our support for Nebraska servicemembers, veterans, and their families."

In September, Senator Ruben Gallego (D-AZ) introduced the You Earn It, You Keep It Act, which seeks to remove income tax from Social Security income by expanding the Social Security payroll tax to covered earnings of $250,000 a year or more.