U.__For tax years beginning on or after January 1, 2006 and for military personnel retiring on or after January 1, 2006, an amount equal to benefits paid under a military retirement plan.__For purposes of this paragraph, "military retirement plan" means benefits received as a result of service in the active or reserve components of the Army, Navy, Air Force, Marines or Coast Guard.

SUMMARY

This bill exempts from the state income tax all military pension benefits for military personnel retiring on or after January 1, 2006 received by a Maine resident as a result of service in the active or reserve components of the Army, Navy, Air Force, Marines or Coast Guard. Since the effect of this bill is to totally exempt military pension benefits after January 1, 2006, the express exclusion of military pension benefits from the offset for social security and railroad retirement benefits from the deduction allowed for other pension plans is removed.