Felag bill targets taxes on seniors’ income

Sen. Walter S. Felag, Jr. (D-Dist. 10, Warren, Bristol, Tiverton) will introduce two pieces of legislation in the new 2017 General Assembly session that deal with the recently passed legislation that exempts the first $15,000 in retirement pension benefits from the state’s income tax. After years of submitting legislation, he was successful last year in obtaining some tax relief for retirees, he said in a press release.

The first piece bill will clarify the already passed tax exemption by clearly stating the various types of retirement benefits and plans that will apply to the 2017 tax year. His said his intent is to ensure 401(k), 403(b) and other types of retirement income are included in the tax exemption. He said he has been working with the Division of Taxation to strengthen the recently passed law.

“After consulting with the Division of Taxation, we felt the language of the current law needed to be clearer so that our retired citizens are aware that this very beneficial tax break will keep more money in their pockets come next tax season,” said Senator Felag.

The second piece of legislation that he said he will introduce will take the existing exemption of $15,000 and raise the level to $20,000. Ultimately, all retirement income should be exempt from state taxation, he added.

“At a time when costs of goods and necessary services continue to rise but retirement income remains stagnant, it is crucial that we help those individuals on fixed incomes live their golden years with dignity and financial security,” said Senator Felag. “By raising the tax exemption level to $20,000, we can lessen the financial stress that many retirees feel on a daily basis. Our retirees deserve to enjoy their retirement and raising the tax exemption amount will assist in this endeavor,” added Senator Felag.

Senator Felag plans on introducing these two bills within the coming weeks.