Pete Ricketts gives his second inaugural address, 2019. (Photo: Nebraska National Guard Spc. Lisa Crawford)
U.S. Senator Pete Ricketts (R-NE) has introduced two pieces of legislation focused on eliminating federal taxes on Social Security and military retirement benefits, mirroring policies enacted in Nebraska. The Social Security Check Tax Cut Act and the Tax Cuts for Veterans Act were introduced earlier this week with the goal of providing financial relief to retirees and Veterans.
Ricketts stated that Social Security and Veteran benefits should be completely tax-free, calling the current taxation system unfair to those who have earned these benefits through years of service.
“These aren’t government handouts; they’re benefits that have been earned,” Ricketts stated during a conference call with reporters. “Seniors have paid into Social Security for decades, and Veterans have given years of service to protect our freedoms. We should not be double-taxing them.”
The Social Security Check Tax Cut Act is designed to gradually phase out federal taxes on Social Security benefits. Ricketts pointed out that prior to 1983, Social Security benefits were not taxed at the federal level, but by 1993, 85% of these benefits became taxable. His proposed legislation would begin with a 10% tax cut in the first year, growing to 20% in the second year, with the ultimate goal of making Social Security income tax-free by 2035.
“For a typical retiree, this would mean about $800 back in their pocket,” Ricketts explained. “That’s 202 gallons of milk or 270 gallons of gas at today’s prices—real relief for our seniors.”
Similarly, the Tax Cuts for Veterans Act seeks to make military retirement benefits tax-free at the federal level. Ricketts cited Nebraska’s 2021 law, LB 387, which eliminated state taxes on military retirement benefits, as a successful model for national policy.
“Take an enlisted soldier, sailor, airman, marine, or guardian who serves for 20 years,” said Ricketts. “Under my bill, they could save over $6,000 per year—that’s an extra $500 every single month. That’s real money to cover groceries, gas, housing, or other rising costs.”
The senator stressed the bipartisan nature of Nebraska’s tax reforms, which received unanimous support in the state legislature, and urged Congress to follow suit. He believes these federal tax cuts would not only benefit individual retirees and Veterans but also stimulate economic activity by increasing disposable income.
The proposed legislation has been referred to the Senate Finance Committee for consideration. By eliminating these taxes, Veterans who rely on Social Security and military retirement pay will have more financial stability, helping them cover essential expenses such as housing, healthcare, and daily necessities. If passed, these measures could significantly impact millions of American retirees and Veterans, allowing them to retain more of their hard-earned money in retirement.
“As John F. Kennedy once said, ‘As we express our gratitude, we must never forget that the highest appreciation is not to utter words, but to live by them,’” Ricketts said. “Honoring our Veterans and seniors isn’t just about words—it’s about action.”
Author: Rikki Almanza
Rikki is a Web Content Coordinator for the American Legion, Department of California. With a deep-rooted connection to the military, a spouse who is a Navy veteran, a father who served in the Air Force for 25 years, and a grandfather who proudly served, Rikki is committed to using her skills and knowledge to provide valuable assistance and resources to servicemembers and veterans.
