Though it has been treated as if it was one of the Ten Commandments, Kentucky’s pension exclusion, which exempts pension income from state income taxes, has actually only been in place since 1995. In 1997, the exclusion amount was increased from $6,250, where it had been established two years earlier, to $35,000 and indexed to inflation. The indexing was frozen as part of the 2005 tax reform package at $41,110, providing us with the arbitrary figure that the exclusion remained at for the following 13 years. A decrease in the pension exclusion has historically been supported by Democrats and Republicans alike with Democrats calling for the change for reasons of “fairness” and Republicans as a
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