Dawson v. Steager

The Supreme Court said West Virginia could not tax a retired U.S. Marshal's pension while exempting pensions for certain retired state and local law-enforcement officers. The justices said that unequal treatment violated 4 U.S.C. 111, the federal rule against discriminatory state taxes on federal pay.

The Court ruled for Dawson and said West Virginia's tax scheme violated federal law, but the prompt does not provide the vote count or opinion lineup.

The decision protects federal retirees when states give tax breaks to comparable state retirees. For example, a retired federal law-enforcement officer cannot be singled out for state income tax if a similar retired state officer is exempt.

The Court has finished this case. West Virginia must apply its tax rules in a way that does not discriminate against comparable federal retirees.

The case asked whether West Virginia could tax a retired U.S. Marshal's pension while exempting pensions for certain retired state and local officers. The Supreme Court said no.

Federal retirees are the main group affected, especially those whose jobs are comparable to state employees who get special tax breaks. States must avoid that unequal treatment.

The case is over at the Supreme Court. West Virginia and its tax authorities must follow the decision when applying pension tax rules to comparable federal retirees.