Kentucky Pension Income Exclusion

[leogoldman]

Fixes #3041

Unsure if there's anything other than IRA distributions that should be counted towards other retirement income.

🤖 Generated by Copilot at c1d0849

Summary

📝🧮🚂

This pull request adds the Kentucky pension income exclusion to the policy engine, which allows certain retirees to exclude some or all of their pension and other retirement income from state income tax. It creates new parameters, variables, and tests to implement the logic and calculations of the exclusion, based on the person's retirement status, service credit months, railroad benefits, and income sources. It also updates the changelog entry to reflect the change.

ky_pension_income
Exclusion for retirees
Autumn of their lives

Walkthrough

• Add the ky_pension_income_exclusion variable to calculate the amount of pension and other retirement income that is excluded from Kentucky income tax (link)
• Define the parameters for the pension income exclusion, such as the list of other retirement income sources (link) and the historical values of the exclusion threshold (link)
• Add the ky_pension_income_exclusion_exemption_eligible variable to determine if a person is eligible for exemption from the exclusion cap, based on their retirement status and railroad benefits (link)
• Add the ky_service_credits_percentage_pre_cutoff variable to calculate the share of service credit months a person has worked for the state or local government in Kentucky before 1998, relative to their total service credit months (link)
• Add the ky_service_credit_months_pre_cutoff and ky_service_credit_months_post_cutoff variables to store the number of service credit months a person has worked for the state or local government in Kentucky before and after 1997 (link, link)
• Add the retired_from_ky_government and retired_from_federal_government variables to indicate if a person has retired from the state or local government in Kentucky or the federal government (link, link)
• Add the ira_distributions and receives_railroad_benefits variables to store the amount of distributions a person receives from Individual Retirement Accounts and the indicator of receiving any railroad benefits (link, link)
• Create test files for the ky_pension_income_exclusion, ky_pension_income_exclusion_exemption_eligible, and ky_service_credits_percentage_pre_cutoff variables, using different scenarios of income, retirement status, and service credit months (link, link, link)
• Update the changelog entry to reflect the actual change made, which was adding the Kentucky pension income exclusion, not the family size tax credit (link)

[codecov]

Codecov Report

All modified lines are covered by tests ✅

Comparison is base (55ec465) 98.71% compared to head (1ea68ec) 98.94%.
Report is 658 commits behind head on master.

Additional details and impacted files

@@            Coverage Diff             @@
##           master    #3043      +/-   ##
==========================================
+ Coverage   98.71%   98.94%   +0.23%     
==========================================
  Files        1714     1778      +64     
  Lines       25815    26625     +810     
  Branches      145      148       +3     
==========================================
+ Hits        25483    26344     +861     
+ Misses        301      244      -57     
- Partials       31       37       +6     

Files	Coverage Δ
...ions/pension_income/ky_pension_income_exclusion.py	100.00% <100.00%> (ø)
.../ky_pension_income_exclusion_exemption_eligible.py	100.00% <100.00%> (ø)
...nsion_income/ky_service_credit_months_post_1997.py	100.00% <100.00%> (ø)
...ension_income/ky_service_credit_months_pre_1998.py	100.00% <100.00%> (ø)
...n_income/ky_service_credits_percentage_pre_1998.py	100.00% <100.00%> (ø)
...sions/pension_income/retired_from_ky_government.py	100.00% <100.00%> (ø)
...ographic/person/retired_from_federal_government.py	100.00% <100.00%> (ø)
...erson/pensions/distributions_from_401k_accounts.py	100.00% <100.00%> (ø)
...sehold/income/person/pensions/railroad_benefits.py	100.00% <100.00%> (ø)
...ncome/person/pensions/regular_ira_distributions.py	100.00% <100.00%> (ø)
... and 1 more

... and 100 files with indirect coverage changes

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