Nebraska Panhandle News

U.S. Senator Pete Ricketts has introduced two bills aimed at reducing federal taxes on Social Security and military retirement benefits. The first, known as the Social Security Check Tax Cut Act, seeks to gradually eliminate federal taxes on Social Security benefits. This bill draws inspiration from successful state-level efforts during Ricketts' tenure as Governor of Nebraska.

“Social Security and veterans’ benefits should be completely tax-free,” stated Senator Ricketts. He emphasized the need for federal relief similar to that provided in Nebraska, noting that these measures would increase retirement income and allow seniors and veterans to retain more of their earnings.

In collaboration with Senator Jacky Rosen, a Democrat from Nevada, Ricketts also introduced the bipartisan Tax Cuts for Veterans Act. This legislation aims to remove federal taxes on military retirement benefits. “Veterans in Nevada and across our nation have made huge sacrifices to keep our nation safe," said Senator Rosen regarding this act. "We’re introducing this bipartisan bill to make military retirement pay tax-free."

The introduction of these bills follows previous coverage by Punchbowl News, with further discussion expected during Senator Ricketts' weekly press conference call with Nebraska media.

Historically, Social Security has been a cornerstone of American retirement plans since its inception in 1935. Originally untaxed until 1983, a portion of Social Security benefits became taxable under subsequent legislative changes signed into law by President Bill Clinton in 1993.

As Governor of Nebraska in 2022, Ricketts enacted LB873 to phase out state taxes on Social Security over several years. The proposed federal legislation mirrors this phased approach by starting with a 10% reduction in the first year and potentially making all Social Security income tax-free by 2035.

Regarding military retirement benefits, around 117,000 veterans reside in Nebraska alone. In his governorship role in 2021, Ricketts signed LB387 into law to eliminate state taxes on such benefits—a move unanimously supported by the legislature.

The Tax Cuts for Veterans Act promises substantial financial relief for veterans and their families across the country. Depending on their service duration and earned retirement pay, an enlisted veteran could save significant amounts annually if the proposed bill becomes law.