As a result of the North Carolina Supreme Court's decision in Bailey v. State of North Carolina (1998), North Carolina may not tax certain retirement benefits received by retirees of the State of North Carolina and its local government or by the United States government retirees (including military) for each retirement plan if the retiree has five or more years of creditable service as of August 12, 1989.

That means you have to have joined prior to August 12, 1984 to be eligible. The legislature has sponsored bills periodically since then to progressively move the applicable date forward, but since North Carolina has never met a tax it didn't like, they keep dying in committee. We shouldn't have to sue (again) to re-establish this principle. Please contact your state legislator and voice your support for NC House Bill 103!

If you are a retiree of the State of NC, local government or a US military/government retiree this is a significant amount of money - as an example, a retired E-9 with 25 years of service would get $1,100 dollars put back in their pocket.

The bill is going to committee, again. Please call or send your rep an email today.

UPDATE: NOT good news. I emailed Representative George Cleveland (good guy, the bills originator) for an update, and this is what I got back:
"Mr *******, The bill is still in the Finance Committee and I do not think it will be heard this session.  Unfortunately, I am unable to rally the support of leadership to move the bill to the Senate."

North Carolina not only discontinued the $4,000 military deduction, they're now stonewalling HB 103 even though a large number of the original recipients are passing on. If you're one of the folks like me who take the time to contact your reps, I would highly encourage you to let them know we don't appreciate their non-support of our veterans

That's an awful specific date.  I'd need that to move about 6 or 7 years in the future to benefit, however what date are they talking about?  I pay $100 a month to the state.

That date came about as the result of the NC Supreme Court-ordered decision. I won't swear to this, but I believe NC agreed to review and periodically roll the date forward as time progressed to cover the (aging) retirees who would follow on. That may not be gospel - my uncle was heavily involved in the first lawsuit and I'm taking it from memory of his experience.

If NC reneges on this first bump, you have zero chance of ever getting the exclusion. That's why it's in every state/federal retirees interest to push this.

Has something changed? My dad retired in 2011 and he is "Bailey vested" or whatever they call it. I don't think he was working since before 1984 but I guess he might have been.

It's definitely not impossible for him from an age standpoint. The point is to get the next cohort over the bar, and set a precedence that keeps rolling for all the retirees.

I paid NC State income tax for the first 11 years I was in the military. I was living overseas...

This  is great news! We are in the process of buying a house on topsail Island and I am a government employee since 1977. So no state income tax  is what I am reading here, fantastic!

I pay $1600 a year state tax on my $35k a year retirement check.

tax on my house is $989

I can't complain taxwise, but It would be nice to pay nothing 

I get enough back in fed each year to cover my state tax.

So how far are they rolling it back? I joined the Army in 91

I joined the AF in 1987, so I'm just out of the ballpark. That's why I keep writing the legislature...sooner or later they have to (well, they don't have to, but eventually they'll get sued again and lose) roll the date forward to cover the next cohort of retirees. It's at 1989 with five years of creditable service right now. If they moved it forward five years to 1994 with five years, I'd be covered but you wouldn't. If they rolled it forward ten years to 1999 with five years, we'd both be covered.

Once you're covered, you pay ZERO N.C. state tax on your mil/federal retirement. I retired as an E-9 at 25 years, so it would put $1,100 back in my wallet. I have no qualms about taking it, either. I paid NC state tax for 11 years as a single G.I. living overseas. Wrote the state then and told them it was complete BS, and they wrote back and told me tough shit, pay your taxes.

UPDATE: Bill goes to the State Finance Committee on April TOMORROW (April 11).

Sweet, I joined the NG in 89, and went active in 91. hopefully I will be covered.

anyone have a sample letter and maybe we can get it posted in the military forum and get some more support.

The way I read the bill it will be a phase in system.

since I was NG from 89-91 I will quit having to pay state tax in 2019.

here is a link

http://www.ncleg.net/Sessions/2017/FiscalNotes/House/PDF/HFN0103v1.pdf

I paid state tax for years on AD until I was stationed in FL.

 I changed my residency to FL and didn't pay state tax my last 7 yrs.

Both of my sons claimed FL as well and pay no state tax on their military pay.

Its easy just go to S-1 and change it. 

Had lots of soldiers do it, NC sucks for benifits when you get out so there is no downside to doing it.

Any updates?

Passed first reading in Feb, and was referred to the Finance Committee. If it clears them it goes to the Pensions and Retirement Committee.

February. As in almost four months ago.

Wow that sucks, my VA rep laughed when I told him about this. He said NC isn't changing the tax laws.

NC doesn't give a damn when it comes to Active duty retirees, NG retirement pay is exempt form taxes but not us active
duty guys.

Looks it is now house bill 153


http://www.ncleg.net/gascripts/BillLookUp/BillLookUp.pl?Session=2017&BillID=S153

http://www.ncga.state.nc.us/Sessions/2017/Bills/Senate/PDF/S153v2.pdf

Here is the roll call, I hope this passes

http://www.ncleg.net/gascripts/voteHistory/RollCallVoteTranscript.pl?sSession=2017&sChamber=S&RCS=394