Seniors get tax relief on Social Security

By Jason Crowell

Earlier this month the Missouri Senate took an important step toward easing the financial burden of Missouri's seniors by passing House Bill 444. This bill ends excessive taxation on Social Security and retirement benefits by the state, and I am excited about this victory. Social Security was designed to make sure that getting older did not mean facing poverty. Missouri has lost the original meaning of that over the years due to an unfair income tax on retirement benefits.

HB 444 will phase out the state income tax on Social Security benefits. It will begin at 20 percent for 2007, eventually becoming a complete 100 percent exemption by 2012. The tax relief act also exempts Social Security disability and nonprivate retirement benefits from being taxed by the state. The qualifying nonprivate retirement benefits are plans for firemen and police officers, railroad workers and teachers as well as veterans and certain federal employees. These pensions, for public employees who aren't eligible for Social Security, will be exempt from state taxes up to $32,500 by 2012. Seniors 62 or over and all disabled residents will be eligible for the exemptions. An income threshold of $85,000 for an individual or $100,000 for a couple applies.

Missouri is one of 15 states that still taxes Social Security benefits. It is about time for the seniors in this state to receive the same benefits as others in other states. Take the example of a retired firefighter who contacted me earlier this year. He and his wife moved to Cape Girardeau in order to be closer to family and were frustrated to learn that the pension that he received for his service to his community would be taxed in Missouri even though it had not been taxed in Illinois. He also told me he might be forced to move back, away from his family, so that he could support himself and his wife. This story is too familiar. Our current policy of taxing Social Security doesn't make sense. Seniors have been taxed their entire working careers to fill Social Security coffers; they should not have to pay a second time when collecting the benefits they deserve and depend on.

I understand that Missouri's seniors are living on fixed incomes and it is sometimes difficult to make ends meet. This is why I have championed the effort in the Senate to get HB 444 passed. After receiving final approval from the legislature May 11, this bill is now on to the governor's desk for his signature.

Jason Crowell of Cape Girardeau represents the 27th District in the Missouri Senate.