Georgia Passes Unlimited Retirement Exclusion

On May 12, 2010, Georgia Governor Sonny Perdue signed House Bill 1055 into law.  This bill includes a provision to increase the amount of retirement income which is not subject to Georgia income tax.  Under prior law, taxpayers who were at least 62 years old or disabled were allowed to exclude up to $35,000 of retirement income from their taxable income.  Retirement income includes interest, dividend, rent and royalty income, capital gains, pensions, annuities, other unearned income, and up to $4,000 of earned income.

 

Under the new law, the retirement income exclusion for tax years 2012 through 2015 will increase according to the schedule below for taxpayers who are age 65 or older.

  • 2012 – $65,000 exclusion
  • 2013 – $100,000 exclusion
  • 2014 – $150,000 exclusion
  • 2015 – $200,000 exclusion

Beginning in 2016, the new law allows an UNLIMITED exclusion of all retirement income for taxpayers who are age 65 or older.  The retirement exclusion for taxpayers who are age 62 to 64 will remain at $35,000.

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