The Nation - News from Aug. 16, 1989

A tax court held that Arizona must reimburse about 72,000 retirees for state income taxes they paid on their federal pensions. Judge William Moroney cited a U.S. Supreme Court ruling earlier this year, in which Michigan was told it could not tax federal retirees unless it also taxed state, county and local government pensioners. Craig Corimier, a deputy director in Arizona’s Department of Revenue, had warned that such a ruling could be “financially devastating” because it could cost the state as much as $210 million. He said the revenue agency had not yet decided whether to appeal the decision.