NC H473

Expands the definition of "retirement plan" in North Carolina tax code to include individual retirement accounts and plans as defined in the federal Internal Revenue Code.

Creates a phased-in tax deduction for government retirement benefits beginning in 2011, with eligibility based on when a taxpayer became vested in their plan, fully implemented by 2019 for those vested by August 2016.

Allows a deduction for retirement benefits from out-of-state government retirement plans, either matching what that state would allow for North Carolina benefits or up to $4,000 annually, whichever is greater.

Maintains existing $2,000 annual deduction cap for non-government retirement plan benefits and allows married couples filing jointly to apply maximum amounts separately to each spouse's benefits.

Phases out the new government retiree benefit deduction on January 1, 2020, and replaces it with the provisions in Section 3 of the act.