15 States That Tax Military Retirement Pay (and Other States That Don't)

Taxes on military retirement pay vary from state-to-state. How generous is your state when it comes to helping retired veterans at tax time?

picture of dog tags and military patches
(Image credit: Getty Images)

If you spent your career in the military, you've probably lived all over the U.S. and around the world. But before you put down roots in retirement, find out how much of your hard-earned pension will be taxed. You'll pay income tax to the federal government on military retirement pay that's based on age or length of service (disability pensions might not be taxed). However, with state taxes on military retirement pay, it isn't always so clear.

Many states provide special income tax breaks for military retirees or for retirement income in general. And, of course, some states don't even have an income tax. But some other states aren't so generous when it comes to helping retired veterans at tax time.

We've identified 15 states (including Washington, D.C.) that could tax at least part of a veteran's military retirement pay…and some of them will tax the entire amount. If you're a veteran receiving a military pension, check out the list before you pick a state for retirement – it could save you thousands of dollars each year.

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Unless otherwise noted, income tax rate information is for the 2022 tax year.

Rocky Mengle
Senior Tax Editor, Kiplinger.com

Rocky is a Senior Tax Editor for Kiplinger with more than 20 years of experience covering federal and state tax developments. Before coming to Kiplinger, he worked for Wolters Kluwer Tax & Accounting and Kleinrock Publishing, where he provided breaking news and guidance for CPAs, tax attorneys, and other tax professionals. He has also been quoted as an expert by USA Today, Forbes, U.S. News & World Report, Reuters, Accounting Today, and other media outlets. Rocky has a law degree from the University of Connecticut and a B.A. in History from Salisbury University.