Governor Ivy signed HB162 into law which exempts the first $6,000 of retirement plan distributions for taxpayers age 65 or older beginning January 1, 2023. This mirrors the taxation of defined benefit plans for other plans such as 401K or IRAs. The exemption increases by $6,000 per year until it reaches $24,000 in 2026. The exemption is per spouse. Each spouse may then use the exemption for their respective retirement distributions. For 2023, the tax savings are approximately $300 per person, increasing to $1,200 in 2026.
A copy of the bill is attached.
Please contact your Dent Moses advisor if you have questions.