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HOUSE REPUBLICANS COME TO THE AID OF SENIORS WITH
ELIMINATION OF TAXES ON RETIREMENT INCOME
On
Tuesday, House Republicans tackled the most significant piece of tax relief in
recent years by phasing out pension and Social Security taxes for Iowa’s
seniors, and eliminating income taxes on low-to moderate-wage earning Iowans 65
and older.
House
Republicans believe this has long been an unfair tax that shackles our seniors –
those who have paid into a system all of their lives – based solely on the fact
that they want to remain in Iowa.
Seniors
provide a wealth of volunteer hours in our communities, and they are the angel
investors that build our ballparks, libraries and community centers. When they
leave the state, they leave the communities that raise their grandchildren and
employ their children.
The
legislation,
HF 2045, is a five-year phase-out of the state tax on both pensions and
Social Security benefits. The phase-out begins in calendar year 2007.
Also in the
bill, beginning in calendar year 2008, single Iowans 65 and older will not be
taxed on their income up to $36,000, and married individuals will not pay income
taxes on their first $48,000.
This includes
rental income from farmland and capital gains, plus other areas of common
income.
Retirement Tax Cuts
- The government bureaucracy
is complaining that we are taking this money off the table. Well
Republicans would rather take it off the government’s table and put it back
onto our senior’s kitchen table.
- In the last election, we
heard a lot about prescription drug costs for seniors. How we would not
want to see seniors have to choose between food and prescription drugs.
Well here is our chance to help seniors afford both.
- We go to great lengths to
protect government’s ability to spend. Why don’t we go to those same great
lengths to help Iowans save?
- Eliminating the tax on
pension and social security income along with excluding certain income for
Iowans 65 and older will help retired Iowans take care of themselves and
reduce their dependence on government services thereby reducing the cost to
the taxpayer.
- You cannot have strong
communities if you are driving seniors and grandparents out of the state
because of high taxes.
- You cannot have strong
communities if your seniors are unable to enjoy their family and participate
in their communities because high taxes limit their income and drive them
out of the state.
How will
Republicans pay for this tax cut?
Republicans
and Democrats both supported this tax cut. Which means we will both have make
sure it fits within our budget. Furthermore, Governor Vilsack said in his
Condition of the State speech that we have the fastest growing economy in the
Midwest and the eighth fastest growing economy in the nation. Growing revenue
will help refill any dip in revenue because of this tax cut.
HOUSE
APPROVES REPAYMENT TO SENIOR LIVING TRUST FUND, KEEPS PROMISE TO IOWA’S SENIORS
On Monday,
January 30, the House unanimously approved
HF 2002, which keeps the House Republicans’ promise to seniors by increasing
the amount required to be repaid to the Senior Living Trust Fund.
The Senior Living Trust Fund (SLTF) was created by the Legislature
in 2000 to implement assisted living programs to keep seniors from
having to be placed in nursing homes. It was funded with $300
million in federal funds, which came to the state during FY 2001 to
FY 2005.
However, due
to the recession that began in the second half of FY 2001, the Legislature
borrowed funds from the SLTF to fund Medicaid. This was necessary because the
other choices would have been to eliminate services, decrease eligibility or,
even worse, raise taxes.
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