DE SB329

Defines "United States military pension" for Delaware income tax purposes as pensions received from service in the Army, Navy, Air Force, Marine Corps, Space Force, Coast Guard, NOAA commissioned corps, Public Health Service commissioned corps, or National Guard.

For persons under age 60 starting in taxable year 2022, allows exclusion of the greater amount: up to $2,000 from general employer/government pensions or up to $12,500 from U.S. military pensions.

For persons age 60 or older starting in taxable year 2022, allows exclusion of up to $12,500 from pensions and eligible retirement income (unchanged from prior law).

Defines "eligible retirement income" to include distributions from qualified retirement plans, 401(k) plans, government deferred compensation plans, and dividends, capital gains, interest, and rental income from real property.

For spouses holding eligible retirement income as joint tenants with right of survivorship or tenants by the entirety, each spouse is deemed to have received one-half of the income for exclusion calculation purposes.