Public Act 597 of 2012 (SB 409)
The act excludes retirement or pension benefits from employment with a government agency that isn’t covered by the Social Security Act; to the extent those benefits were included in adjusted gross income.
When determining taxable income the following apply:
Beginning January 1, 2013, for a person born in 1946 through 1952 the sum of the deduction is limited to $35,000 for a single return and $55,000 for a joint return. If both the husband and wife filing a joint return receive retirement or pension benefits from employment with a government agency not covered by the Social Security Act, than the sum of the deduction is $70,000.
For a person born after 1952, who is between the ages of 62 through 67 and who received retirement or pension from a government agency not covered by the Social Security Act, the sum of the deduction is $15,000 for both a single and joint return. If both the husband and wife filing the joint return receive retirement or pension benefits from employment with a government agency not covered by the Social Security Act, than the sum of the deduction is $30,000. When the person reaches the age of 67, they are eligible for a deduction of $20,000 for a single return and $40,000 for a joint return.
