Virginia House Bill 47 Aims to Expand Tax Relief for Military and Foreign Service Retirees

Sep 16, 2026, 12:00 PM ET

Legislative folder labeled HB47 on a committee table in a hearing room

RICHMOND, Va. – House Bill 47, which seeks to broaden state income tax subtractions for retirement benefits earned by members of the uniformed services and United States Foreign Service officers, has been left in the House Finance Committee as the 2026 legislative session progresses. Introduced by Delegate David Reid of the 28th District in Loudoun County, the legislation represents an effort to recognize the contributions of those who have served in critical national roles by reducing their Virginia tax liabilities in retirement.

The bill proposes amendments to Section 58.1-322.02 of the Code of Virginia, specifically targeting subtractions from federal adjusted gross income when calculating Virginia taxable income. Currently, Virginia allows a subtraction of up to $40,000 for retirement benefits from service in the United States Armed Forces. HB47 would extend this benefit to include retirement income from pension plans for service in all uniformed services of the United States. This encompasses not only the Armed Forces but also the commissioned corps of the National Oceanic and Atmospheric Administration and the commissioned corps of the United States Public Health Service.

Additionally, the measure introduces a new subtraction of up to $40,000 for foreign service retirement benefits. These are defined as amounts received from a foreign service member’s pension plan under the Foreign Service Retirement and Disability System or the Foreign Service Pension System, as outlined in federal law under 22 U.S.C. §§ 4041 through 4069 and §§ 4071 through 4071k. The subtractions would apply to taxable years beginning on and after January 1, 2027, and include safeguards to prevent double-dipping, disallowing the subtraction if the same income qualifies for another credit, exemption, subtraction, or deduction under Virginia or federal law.

Prefiled on December 29, 2025, and offered on January 14, 2026, HB47 was promptly referred to the House Committee on Finance. A fiscal impact statement from the Department of Taxation, released on January 18, 2026, projected ongoing revenue losses to the general fund. For fiscal year 2027, the estimated loss stands at $650,000, rising to $1,600,000 by fiscal year 2032. The breakdown attributes approximately $460,000 in 2027 to the uniformed services expansion and $190,000 to the new foreign service provision, with figures increasing over time due to growing retiree populations and inflation adjustments.

The bill advanced to Subcommittee 1 of the Finance Committee, where on January 26, 2026, members voted 8-2 to recommend laying it on the table. This action effectively halted further progress in the subcommittee. On February 18, 2026, the full Finance Committee left the bill in place without further movement, signaling its likely failure to advance to the House floor during this session.

Co-patronized by Delegate Paul Krizek, HB47 aligns with Virginia’s existing array of tax preferences for military personnel and veterans. The commonwealth already provides subtractions for National Guard wages, combat zone pay, extended active duty benefits, death gratuities, and Congressional Medal of Honor recipients, alongside property tax exemptions for certain disabled veterans. This proposed expansion underscores the state’s commitment to supporting those who have dedicated their careers to defending the nation and advancing American interests abroad.

Public comments submitted during committee proceedings highlighted strong backing for the measure. One supporter emphasized the need to extend tax relief to retired Foreign Service officers, noting it would address a gap in recognition for their service. The Department of Taxation deemed administrative costs routine, requiring no additional funding or significant system changes.

As Virginia navigates its budget priorities, HB47’s focus on tax relief for service members arrives amid discussions on affordability and economic incentives. With military installations and a substantial retiree community contributing to the state’s economy, such measures could enhance Virginia’s appeal as a retirement destination for those with federal service backgrounds. However, the projected multimillion-dollar revenue impacts over successive years played a role in the committee’s decision to table the bill.

The 2026 Regular Session continues, with lawmakers addressing a range of fiscal policies. While HB47’s path forward appears dim, its introduction spotlights ongoing efforts to honor uniformed services retirees and diplomats through targeted tax policies that ease the transition to civilian life in the commonwealth.

Email the Loudoun County School Board:
April Chandler, april.chandler@lcps.org,
Anne Donohue, anne.donohue@lcps.org,
Deana Griffiths, deana.griffiths@lcps.org,
Ross Svenson, ross.stevenson@lcps.org,
Kari LaBell, kari.labell@lcps.org,
Jon Pepper, jonathon.pepper@lcps.org,
Lauren Shernoff, lauren.shernoff@lcps.org,
Sumera Rashid, sumera.rashid@lcps.org,
Amy Riccardi, amy.riccardi@lcps.org,

Email the Board of Supervisors at:
Phyllis J. Randall (Chair, At-Large) – Phyllis.Randall@loudoun.gov,
Michael R. Turner (Vice Chair, Ashburn District) – Mike.Turner@loudoun.gov,
Juli E. Briskman (Algonkian District) – Juli.Briskman@loudoun.gov,
Sylvia R. Glass (Broad Run District) – Sylvia.Glass@loudoun.gov,
Caleb Kershner (Catoctin District) – caleb.kershner@loudoun.gov,
Matthew F. Letourneau (Dulles District) – Matt.Letourneau@loudoun.gov,
Kristen C. Umstattd (Leesburg District) – Kristen.Umstattd@loudoun.gov,
Laura A. TeKrony (Little River District) – Laura.TeKrony@loudoun.gov,
Koran Saines (Sterling District) – Koran.Saines@loudoun.gov

Email the Richmond City Council:
Andrew Breton, andrew.breton@rva.gov,
Katherine Jordan, katherine.jordan@rva.gov,
Kenya Gibson, kenya.gibson@rva.gov,
Sarah Abubaker, sarah.abubaker@rva.gov,
Stephanie Lynch, stephanie.lynch@rva.gov,
Ellen Robertson, ellen.robertson@rva.gov,
Cynthia Newbille, cynthia.newbille@rva.gov,
Reva Trammell, reva.trammell@rva.gov,
Nicole Jones, nicole.jones@rva.gov,

Email the Richmond School Board:
Matthew Percival, mpercival@rvaschools.net,
Kathryn Ricard, kricard@rvaschools.net,
Ali Faruk, afaruk@rvaschools.net,
Wesley Hedgepeth, whedgepeth@rvaschools.net,
Stephanie Rizzi, srizzi@rvaschools.net,
Anne Holton, aholton@rvaschools.net,
Cheryl Burke, cburke2@rvaschools.net,
Emmett Jafari, ejafari@rvaschools.net,
Shavonda Fernandez, sdixon@rvaschools.net,

Loudoun County Richmond Virginia House of Delegates Adele McClure Affordability Alex Askew Alfonso Lopez Ali Faruk Amendments Amy Laufer Amy Riccardi Andrew Breton Anne Donohue Anne Holton Anne Tata April Chandler Atoosa Reaser Barry Knight Betsy Carr Bill Wiley Bonita Anthony Briana Sewell Buddy Fowler Budget Caleb Kershner Charlie Schmidt Charniele Herring Cheryl Burke Chris Runion Cia Price Cliff Hayes Cynthia Newbille Dan Helmer David Reid Deana Griffiths Debra Gardner Delores McQuinn Delores Oates Destiny LeVere Bolling Disability Don Scott economy Elizabeth Bennett-Parker Elizabeth Guzmán Ellen McLaughlin Ellen Robertson Emmett Jafari Eric Phillips Eric Zehr Garrett McGuire Gretchen Bulova Health Hillary Kent Holly Seibold inflation Irene Shin Israel O'Quinn Jackie Glass Jas Jeet Singh Jason Ballard Jay Leftwich Jeion Ward Jessica Anderson John McAuliff Jon Pepper Joseph McNamara Josh Thomas Joshua Cole Juli Briskman Justin Pence Kacey Carnegie Karen Hamilton Karen Keys-Gamarra Kari LaBell Karrie Delaney Katherine Jordan Kathryn Ricard Kathy Tran Katrina Callsen Keith Hodges Kelly Convirs-Fowler Kenya Gibson Kimberly Pope Adams Koran Saines Kristen Umstattd Laura Cohen Laura TeKrony Lauren Shernoff Lawmakers Lee Ware Legislation Leslie Mehta Lily Franklin Lindsey Dougherty Loudoun County Loudoun County Board of Supervisors Loudoun County School Board Luke Torian Madison Whittle Marcus Simon Margaret Franklin Mark Downey Marty Martinez Matt Letourneau Matthew Percival May Nivar Michael Feggans Michael Webert Michelle Maldonado Mike Cherry Mike Turner Mitchell Cornett Nadarius Clark Nicole Cole Nicole Jones Otto Wachsmann Patrick Hope Paul Krizek Phil Hernandez Phillip Scott Phyllis Randall Rae Cousins Reva Trammell Richmond Richmond City Council Richmond School Board Rip Sullivan Robert Bloxom Rodney Willett Ross Svenson Rozia Henson Sam Rasoul Sarah Abubaker Scott Wyatt Shavonda Fernandez Shelly Simonds Stacey Carroll Stephanie Lynch Stephanie Rizzi Sumera Rashid Sylvia Glass Terry Austin Terry Kilgore Tim Griffin Tom Garrett Tommy Wright Tony Wilt Veterans Virgil Thornton Virginia Virginia House Virginia House of Delegates Vivian Watts Wendell Walker Wesley Hedgepeth Will Davis Will Morefield Wren Williams