Document: 503 U.S. 594 112 S.Ct. 1619 118 L.Ed.2d 243 Keyton E. BARKER and Pauline Barker, et al., Petitionersv.KANSAS al. No. 91-611. Argued March 3, 1992. Decided April 21, Syllabus Title 4 U.S.C. § 111 authorizes the States to tax federal employees' compensation if taxation does not discriminate against employees because of compensation's source. After Davis v. Michigan Dept. Treasury, 489 803, 109 1500, 103 891 (1989), invalidated, under doctrine intergovernmental immunity, income imposed on benefits federal, but state local, civil service retirees, petitioners filed suit in a Kansas court challenging that State's imposition an military retirement received by retired local government employees. In affirming trial court's grant summary judgment for defendants, State Supreme Court concluded constitute reduced pay current services, contrast deferred past services embodied benefits, this "significant differenc[e]" justified differential treatment two classes retirees Davis, supra, at 816, S.Ct., 1508. Held: The is inconsistent with 111. Court's conclusion that, purposes taxation, may be characterized as survive analysis several bases. First, there are no differences" between terms calculating benefits. amount member receives computed basis continuing duties he actually performs, years served active duty rank obtained prior retirement. Military thus determined manner very similar Public Employee Retirement System. Second, precedents discussing provide support holding. statement United Tyler, 105 244, 245, 26 L.Ed. 985, such effectively indistinguishable from rate was made context particular holding case, cannot taken establishing all equivalent services. And, although McCarty McCarty, 453 210, 222, 101 2728, 2736, 69 589 (1981), referred it did expressly approve Tyler description pay, specifically reserved question whether law prohibits characterizing urged tread caution area. Third, examination other statutes treating indicates Congress many consider See, e.g., 10 1408(c)(1); 219(f)(1). Thus, like paid considered Pp. 597-605. 249 Kan. 186, 815 P.2d 46, reversed remanded. WHITE, J., delivered opinion unanimous Court. STEVENS, concurring opinion, which THOMAS, joined. Kevin M. Fowler, Topeka, Kan., petitioners. John F. Manning, Washington, D.C., amicus curiae special leave James A.D. Bartle, respondents. Justice WHITE 1 taxes Kan.Stat.Ann. 79-3201 seq. (1989).1 issue before us 111, provides: 2 "The consents or personal officer employee States, territory possession political subdivision thereof, District Columbia, agency instrumentality one more foregoing, duly constituted taxing authority having jurisdiction, source compensation." 3 Shortly after our decision invalidated class actions were Together comprised some 14,000 who armed forces subject 1984 through 1989. also included spouses where applicable. Plaintiff taxpayers sought declaratory discriminates them favor violation constitutional principles immunity applied Davis. They requested permanent injunction prohibit assessment well refunds any members 1989.2 granted affirmed. We certiorari below arguably conflicts decisions courts last resort. 502 ----, 576, 116 602 (1991).3 Our approach deciding case controlled retirees' retirees. reaching decision, we traced history "the retention coextensive prohibition discriminatory modern immunity." U.S., 813, 1506. Under doctrine, evaluate alleged inquiring "whether directly related to, by, 'significant differences classes.' " Id., 1508 (quoting Phillips Chemical Co. Dumas Independent School Dist., 361 376, 383, 80 474, 479, 384 (1960)). 5 Well aware undertook inquiry significant existed taxed Kansas, not. proceeded six proffered distinctions pensioners: 6 "(1) [F]ederal remain they retire duty; only; (2) Uniform Code (UCMJ) martialed offenses committed retirement; (3) restrictions civilian employment (4) involuntary recall; (5) continued readiness return (6) system noncontributory funded annual appropriations Congress; thus, have never been tax." 196, 53 (1991). 7 deemed first four significant, themselves disparate treatment, supported fifth distinction—that rather than 197, P.2d, 53. By contrast, "state compensation," found, "not pay." Ibid. principal distinction their laws. Accordingly, held retiree's legally personnel, whose liable pursuant States' consent, expressed 8 unquestionably these respects different including whom tax. But differences, standing alone, do justify case. Nor persuasively indicate treat As general matter, retiree entitled stated percentage level achieved retirement, multiplied creditable service. Brief Amicus Curiae 11, n. 16. respect, "retired [military] bears features compensation. calculated retirement." 223, 16, (1981). taking into account service, formula used calculate leaves open possibility creating disparities among same preretirement rank. Such explained "current services," since presumably benefit differentials would performing "services." Furthermore, therefore, see State. 9 contrary, however, found precedents. 985 (1882), example, decided officers increase statute had provided officers. reached result part "compensation [that] rate, connection continued, only." 985.4 supra. California applicability community property laws 18 eligible hence. division upon dissolution marriage. challenged grounds: first, his prospective performed during marriage; second, applying conflicted scheme regardless See id., 221, 2735. Citing quoting noted differed personnel led various courts, "including one," opine 2736. need, decide sustained petitioner's alternative ground overturning below. 11 reasoned recognition holding, Courts Appeals, indicated pay. It could validly discriminating employees, exempt being 198, 54. For reasons, find reading unpersuasive. 12 unnecessary reach intended include certain its provision increasing active-duty increase, based "uniform treatment" statutory provisions "a army" determining eligibility increase. 245-246, 985. described manifest difference kinds namely, retiring wholly altogether service." latter group ineligible completely terminated. interpreting applicable provisions, crucial decision; 13 Moreover, To declining hold forbade resting another ground, punctuate point, despite divided 222-223 nn. 15 2736-2737 compensation, indicia restriction activities chance recalled duty. Hence, those risks suggests must area, lest disrupt scheme." 224, 2737, 16 (emphasis added). 14 urging cautious should read settling issue. Indeed, handling opposite. said "[t]he rests premise typical pension, represents marriage." Had accepted definitive 's characterization income, simple foreclosed much easier way decision—that application California's scheme. Finding either method examine congressional intent, inferred Promptly enacted Uniformed Services Former Spouses' Protection Act, 1408(c)(1), negated giving option "either solely spouse accordance jurisdiction court." Because behind permitting apply 2735, clearly believed payment comparable ordinary remuneration extend deeming marital estate matter notion treated both purpose deductibility contributions individual (IRA). purposes, IRA deduction limited taxpayer's $2,000, whichever less. term "compensation" "any pension annuity provision, making deductible IRA. generally Weinstein, Mertens Law Federal Income Taxation 25C.12, p. 58 (1988). follows types 201-202, 56. context, 202-203, 57, position view ignores importance understanding weakened further fact, considers purposes. asserted so versus passive required earn income." 203, 57. contends, failure consistently articulated rationale fact only cloak discrimination federally benefits." 22. 17 therefore conclude light calculated, cases, intent respect significantly retirees.5 reverse remand proceedings opinion. So ordered. 19 THOMAS joins, concurring. 20 While I agree explanation why convinced seriously misapplied immunity. A burden shared equally vast majority citizens 823-824, 1512 (STEVENS, dissenting). Government has legitimate interest protecting judges able claim exemption simply decides give judiciary instead raising salaries. write separately make point what regard perverse nondiscrimination principle review correction Congress. Prudential Insurance Benjamin, 328 408, 66 1142, 90 1342 (1946). explained, arrive adjusted gross taxpayer Tax starting Internal Revenue Code, includes officials 190-191, 49-50 relevant present Kansas' governments deducted taxation. 79-32,117(c)(ii) (Supp.1990); 74-4923(b) (listing taxation). Benefits Civil Service System railroad exempt. §§ 79-32,117(c)(vii) (viii) (Supp.1990). Not hence taxable CIA serving National Oceanic Atmospheric Association Health Service, judges. 205, 58. relied Supremacy Clause Constitution, Privileges Immunities Fourteenth Amendment, Article 2, Constitution. deprived rights secured Constitution Amendment 42 1983. 188, 48. Kuhn State, 817 (Colo.1991) (en banc); Pledger Bosnick, 306 Ark. 45, 811 S.W.2d 286 (1991); Hackman Director Revenue, 771 77 (Mo.1989) banc ), cert. denied, 493 1019, 110 718, 107 738 (1990). explained: "It impossible men declared army, wear uniform, names shall borne register, assigned superior specified detail are, rules articles war, tried, jury, court-martial, breach rules, finally dismissed disgrace, still 246, listing involved here, observed contributed income. hand, contribute out appropriations. court, rest end returned basic "receive while persons receiving receive note applies Central Intelligence Agency, Foreign bankruptcy judges, magistrates. ibid.

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