@jzotto - the State never wanted to provide the tax break. There was a law suit in the 1980's (we all know it in NC as 'Bailey') which forced the State's hand that local, NC state and federal pensions were not taxable. But everyone agreed that anyone who's local, NC state or federal pension vested from that date forward would be taxed on their pension in NC.
Given the military presence in NC (e.g. Camp Lejeune),causing a lot of military retirees to come back to NC, especially the Fayetville area, the legistature passed a law that effective in 2021, military pensions would not be taxable.
Social Security is not taxed.
NC is relatively cheap living - I wouldn't knock the lack of this pension tax break as the cost of living more makes up for it. The state tax rate was dropped from 5.25% to 4.99% in 2022 and is set to step down over the next 4 years until it reaches 3.99% in 2026. (we have a flat tax rate in NC). The first $25,100 of income is tax free (standard deduction - filing joint).
