An act relating to exempting military retirement and survivor benefit income from Vermont income tax

This bill proposes to remove Vermont state income tax on U.S. military retirement income and survivor benefit income. If passed, this change would apply to military retirees and surviving spouses or dependents of service members, taking effect for taxable years starting on or after January 1, 2026. The bill also clarifies how this new exclusion interacts with other existing retirement income tax exclusions.

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