S.B. 162 - Taxation; Pension Income

• Adds income limits for the exemption from state taxation of pension income under the state retirement system for taxable years beginning after December 31, 2010.

• Establishes federal adjusted gross income thresholds: $75,000 for single filers or married filing separately; $100,000 for head of household or surviving spouse; and $125,000 for joint filers.

• Modifies section 88-91 to subject the pension exemption to limitations contained in the new section 235--, and updates section 235-7 to apply the same income-based limitations to pension income exclusions.

• Applies the income limits to exemptions under section 88-91 and exclusions under sections 235-7(a)(2) and 235-7(a)(3), effectively taxing pension income for higher-earning retirees.

• Takes effect upon approval and applies to taxable years beginning after December 31, 2010.