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Bill

SB 10

Income tax, state; subtraction for tax, military retirement benefits, uniformed services.

2025 Regular Session Introduced by Bryce Reeves

Virginia bill allowing subtraction of military retirement and uniformed services income from state income tax liability to reduce taxes on military personnel.

Left in Finance and Appropriations
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WeVote Research Nonpartisan
Bill Summary · SB 10

Legislative bill overview

SB 10 proposes to allow Virginia taxpayers to subtract military retirement benefits and uniformed services compensation from their state income tax calculations. This would create a tax deduction specifically for individuals receiving retirement pay or income from military service, reducing their taxable income at the state level.

Why is this important

Military retirement benefits and compensation represent significant income for veterans and active-duty retirees. This deduction would effectively lower state income taxes for this population, potentially making Virginia more attractive to military personnel and veterans while reducing state tax revenue. Given Virginia's large military presence and defense installations, this could have meaningful budgetary implications.

Potential points of contention

  • Revenue impact: The state tax deduction would reduce general fund revenue, requiring either spending cuts or other revenue sources to offset the loss
  • Equity questions: Targeted tax breaks for specific income sources raise fairness concerns about whether military income deserves different treatment than other forms of income
  • Cost-benefit analysis: Whether the incentive to attract/retain military personnel justifies the fiscal cost compared to other economic development strategies
  • Implementation complexity: Determining which benefits and compensation qualify (federal vs. state, active vs. reserve, disability vs. standard retirement, etc.)

Compiled from official sources — confirm details with the bill’s official record.

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