State Rep. John Frey (R-111) introduced legislation to the Connecticut General Assembly that would exempt all social security income and pension benefits from the state income tax. As a member of the Assembly’s Finance, Revenue, and Bonding Committee, Rep. Frey will play a significant role in advocating the passage of the bill (HB6381).
Connecticut is one of 14 states that taxes residents’ social security benefits. Single residents who earn more than $50,000 per year and married couples who earn more than $60,000 per year are currently taxed at a rate of 25% of their total receipts.
“It is often forgotten that Social Security is absolutely not a handout,” Frey said. “Beneficiaries have compulsorily contributed to the Social Security program throughout their entire careers with the expectation that this money would be returned to them and help provide financial protection for themselves and their families. Taxing retirees after they have worked and paid taxes for their entire lives is unfair and adds an undue burden to their retirements.”
The state is prepared to take in $45.6 million from taxing Social Security benefits in 2017, and Rep. Frey said the revenue could be made up through the elimination of redundant and ineffectual government services as well as a reduction in middle management from state government.
“Connecticut is consistently among the few states that actually lose population each year,” Rep. Frey added. “This exodus will increase if we continue to discourage people from working and retiring here by being one of the few states that tax social security income, on top of all of our other taxes.”
“This is one of my top priorities for this session.”