A BILL TO BE ENTITLED
AN ACT TO EXEMPT FROM INCOME TAX certain COMPENSATION PAID TO MILITARY PERSONNEL.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 105‑134.6(b) is amended by adding a new subdivision to read:
"(b)	Deductions. – The following deductions from taxable income shall be made in calculating North Carolina taxable income, to the extent each item is included in taxable income:
…
(18)	Compensation, up to a maximum of seven thousand five hundred dollars ($7,500), that is paid by the Armed Forces of the United States, including the reserve components, to an individual for active duty, full‑time National Guard duty, or inactive duty training as an officer or enlisted member. In the case of a married couple filing a joint return, each spouse may qualify separately for the deduction allowed under this subdivision."
SECTION 2.  This act is effective for taxable years beginning on or after January 1, 2005.