BISMARCK, N.D. (AP) — North Dakota Gov. Doug Burgum has signed legislation that exempts military retirement pay from state income tax.
The first-term Republican governor signed the legislation on Monday.
The deduction is available to individuals or their survivors who receive military retirement pay. The exemption is effective for the 2019 tax year.
Burgum says the legislation honors veterans and promotes “workforce participation by military personnel in North Dakota after retirement.”
Military members generally may retire after 20 years, leaving many of them in their late 30s or early 40s in search of a new career.
The state Tax Department says there are about 5,100 active duty military, armed forces reserves and National Guard members who would qualify for the pay exemption, at a cost of about $2.8 million every two years.