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Military Pension State Tax Guide

Find out if your state taxes military retirement pay. Many states have recently passed laws to exempt military pensions.

No Income Tax

Fully Exempt

Partially Exempt

Fully Taxed

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Showing 51 states

Alaska

No State Income Tax

No state income tax. Military retirement pay is not taxed.

Exemption:N/A - No income tax

Florida

No State Income Tax

No state income tax. Military retirement pay is not taxed.

Exemption:N/A - No income tax

Nevada

No State Income Tax

No state income tax. Military retirement pay is not taxed.

Exemption:N/A - No income tax

New Hampshire

No State Income Tax

No state income tax on earned income. Previously taxed interest/dividends but that ended in 2025.

Exemption:N/A - No income tax

Recent:Interest/dividends tax fully repealed effective 2025.

South Dakota

No State Income Tax

No state income tax. Military retirement pay is not taxed.

Exemption:N/A - No income tax

Tennessee

No State Income Tax

No state income tax. Previously taxed interest/dividends (Hall Tax) but fully repealed in 2021.

Exemption:N/A - No income tax

Recent:Hall Income Tax fully repealed January 1, 2021.

Texas

No State Income Tax

No state income tax. Military retirement pay is not taxed.

Exemption:N/A - No income tax

Washington

No State Income Tax

No state income tax on earned income or retirement pay. Has a capital gains tax on high earners but does not apply to retirement income.

Exemption:N/A - No income tax

Recent:Capital gains tax enacted 2022 but does not affect retirement pay.

Wyoming

No State Income Tax

No state income tax. Military retirement pay is not taxed.

Exemption:N/A - No income tax

Alabama

Fully Exempt

Military retirement pay is fully exempt from state income tax.

Exemption:100% exempt

Arizona

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:SB 1148 (2022) made military retirement fully exempt starting tax year 2023.

Arkansas

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:Act 141 (2023) made military retirement fully exempt starting 2023.

Connecticut

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024.

Exemption:100% exempt

Recent:Phased in from 50% in 2023 to 100% in 2024.

Hawaii

Fully Exempt

Military retirement pay is fully exempt from state income tax.

Exemption:100% exempt

Illinois

Fully Exempt

Military retirement pay is fully exempt from state income tax. Illinois does not tax any retirement income.

Exemption:100% exempt (all retirement income exempt)

Indiana

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:HB 1002 (2022) made military retirement fully exempt starting 2023.

Idaho

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023. Idaho exempts all retirement benefits paid from federal sources.

Exemption:100% exempt

Recent:HB 172 (2023) confirmed full exemption of military retirement pay.

Iowa

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:HF 2317 (2022) made military retirement fully exempt. Iowa is also phasing out income tax entirely by 2026.

Kansas

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2022.

Exemption:100% exempt

Recent:SB 519 (2021) made military retirement fully exempt starting 2022.

Louisiana

Fully Exempt

Military retirement pay is fully exempt from state income tax.

Exemption:100% exempt

Maine

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024.

Exemption:100% exempt

Recent:LD 390 made military retirement fully exempt starting 2024.

Massachusetts

Fully Exempt

Military retirement pay is fully exempt from state income tax.

Exemption:100% exempt

Michigan

Fully Exempt

Military retirement pay is fully exempt from state income tax.

Exemption:100% exempt

Minnesota

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:HF 1938 (2023) made military retirement fully exempt starting 2023.

Mississippi

Fully Exempt

Military retirement pay is fully exempt from state income tax. Mississippi does not tax any retirement income.

Exemption:100% exempt (all retirement income exempt)

Recent:Mississippi is phasing out income tax entirely.

Missouri

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024.

Exemption:100% exempt

Recent:SB 190 (2023) accelerated full exemption to 2024 (previously phasing in through 2025).

Nebraska

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024.

Exemption:100% exempt

Recent:LB 387 (2023) made military retirement fully exempt starting 2024.

New Jersey

Fully Exempt

Military retirement pay and survivor benefits are fully exempt from state income tax.

Exemption:100% exempt

New York

Fully Exempt

Military retirement pay is fully exempt from state income tax.

Exemption:100% exempt

North Carolina

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024 for veterans with 5+ years of service.

Exemption:100% exempt (5+ years of service)

Recent:HB 83 (2023) made military retirement fully exempt for 5+ year veterans starting 2024.

North Dakota

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2025.

Exemption:100% exempt

Recent:HB 1158 (2023) began phasing in exemption. North Dakota is also moving toward eliminating income tax.

Ohio

Fully Exempt

Military retirement pay is fully exempt from state income tax.

Exemption:100% exempt

Oklahoma

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:HB 1060 (2022) made military retirement fully exempt starting 2023 (previously 75% exempt).

Oregon

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024 for retirees earning under $93,000 (single) / $186,000 (joint).

Exemption:100% exempt (income limits apply)

Recent:HB 3285 (2023) added full exemption with income limits starting 2024.

Pennsylvania

Fully Exempt

Military retirement pay is fully exempt from state income tax. Pennsylvania does not tax any retirement income.

Exemption:100% exempt (all retirement income exempt)

South Carolina

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024.

Exemption:100% exempt

Recent:H 3247 (2022) phased in exemption; fully exempt starting 2024.

Utah

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:SB 11 (2023) made military retirement fully exempt starting 2023.

Virginia

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2025. Previously had a $40,000 annual cap.

Exemption:100% exempt

Recent:HB 273 (2024) removed the $40,000 cap, making it fully exempt starting tax year 2025.

West Virginia

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2024.

Exemption:100% exempt

Recent:HB 4859 (2022) phased in exemption; fully exempt by 2024.

Wisconsin

Fully Exempt

Military retirement pay is fully exempt from state income tax as of 2023.

Exemption:100% exempt

Recent:Act 4 (2023) made military retirement fully exempt starting 2023.

California

Partially Exempt

Military retirement pay is partially exempt as of 2025. California now allows the first $20,000 of military retirement pay to be excluded from state income tax.

Exemption:$20,000

Recent:AB 46 (2024) created a $20,000 military retirement pay exclusion effective tax year 2025.

Colorado

Partially Exempt

Military retirees under 55 can exclude up to $15,000. Those 55-64 can exclude up to $20,000. Age 65+ can exclude up to $24,000.

Exemption:Up to $15,000-$24,000 depending on age

Recent:Exemption amounts adjusted annually.

Delaware

Partially Exempt

Retirees 60+ can exclude up to $12,500 of retirement income including military pensions.

Exemption:$12,500 for age 60+

Georgia

Partially Exempt

Military retirees can exclude up to $35,000 (under 62), $65,000 (62-64), or $65,000 (65+). Starting tax year 2026, the $65,000 exemption applies to all ages.

Exemption:$35,000 - $65,000 depending on age; $65,000 all ages starting 2026

Recent:HB 1064 (2024) increases the exemption to $65,000 for all ages effective TY 2026.

Kentucky

Partially Exempt

Military retirement pay is partially exempt. The first $31,110 of military retirement pay is excluded from state income tax.

Exemption:$31,110

Recent:Exemption cap adjusted periodically. Kentucky considering full exemption legislation.

Maryland

Partially Exempt

First $15,000 of military retirement pay is exempt for retirees 55+. Maryland is phasing in a full exemption by 2027.

Exemption:$15,000 for age 55+ (increasing annually toward full exemption)

Recent:SB 574/HB 771 (2022) phases in full exemption: $15,000 in 2024, increasing to full exemption by 2027.

Montana

Partially Exempt

Military retirement pay receives a partial exemption. First $4,640 is exempt. Additional deduction for retirees 65+.

Exemption:$4,640+ depending on age and income

Recent:Montana simplified its tax structure in 2024.

New Mexico

Partially Exempt

Military retirement pay is exempt up to $30,000 for those under 65, and fully exempt for those 65+.

Exemption:$30,000 (under 65); 100% exempt (65+)

Recent:HB 163 (2022) significantly increased the exemption.

Rhode Island

Partially Exempt

Military retirement pay exempt up to $15,000 for those with AGI under $101,850. Full exemption at age 65+.

Exemption:$15,000 (income limits apply); 100% exempt at 65+

Vermont

Partially Exempt

Military retirement pay may be partially exempt. Vermont offers a retirement income exclusion up to $10,000 for some retirees.

Exemption:Up to $10,000 depending on income

Recent:Vermont has been considering expanding the military retirement exemption.

District of Columbia

Fully Taxed

Military retirement pay is taxed as regular income.

Disclaimer

Tax laws change frequently. This guide reflects laws as of early 2025 and may not include the most recent legislative changes. Always consult a qualified tax professional or your state's Department of Revenue for current tax guidance. This is not tax advice. VA disability compensation is always exempt from federal and state income tax under federal law (26 U.S.C. § 104).