Local legislators co-author new law cutting taxes for active-duty military members

STATEHOUSE (July 21, 2023) – Hoosier military members are set to receive much-needed tax relief thanks to a new law co-authored by local legislators.

Currently, active-duty service members are eligible for a $5,000 deduction from the state individual income tax. State Rep. Craig Haggard (R-Mooresville) said under the new law, active-duty military members will receive a complete income tax exemption beginning in January regardless of their deployment status.

“Indiana has long been a welcoming state to military service members and veterans,” said Haggard, a veteran of the Marines and Indiana Air National Guard. “It’s important that we continue to encourage them to make their home here and start a business or get a high-demand job. We know that Indiana’s employers want and need their skills and talents.”

State Rep. Becky Cash (R-Zionsville) said National Guard and reserve members already receive a $5,000 deduction, and a full income tax exemption when mobilized or on duty.

“Central Indiana is home to many skilled veterans, and we should do everything we can to incentivize more active-duty military to locate to our communities when they transition out of the service,” Cash said. “Our military members and their families make a lot of sacrifices, and this is an easy way to support them.”

According to State Rep. Jeff Thompson (R-Lizton), chair of the House Ways and Means Committee, other states, including Michigan and Kentucky, offer a full income tax exemption to all service members.

“Our state’s strong fiscal standing is providing opportunities to cut taxes in a number of areas, including on the behalf of those who serve in the military,” Thompson said. “This is a commonsense approach to making sure military members keep more of their hard-earned money.”

Visit iga.in.gov to learn more about House Enrolled Act 1034 and other new state laws now in effect.