These Five States Just Eliminated Income Tax on Military Retirement


Five more states just eliminated income tax on Military Retirement – great news for military retirees!

SmartAssett ~ ” Serving in the military is a hard job, with many service members spending long lengths of time away from their family and putting their lives on the line. There are perks that come with service, though, and five states recently added a new one for veterans — eliminating taxes on military retirement income. They aren’t the first states to do this, but they are the most recent.

States Now Not Taxing Military Retirement Income

The latest states to pass a law to not tax military retirement income are:

      • Arizona
      • Utah
      • Indiana
      • Nebraska
      • North Carolina

The law takes effect immediately in Arizona and Utah and will come into effect for the 2022 tax year in Indiana, Nebraska and North Carolina.

Arizona and Utah military retirees may therefore see a large tax refund when they file their taxes this year for the 2021 tax year.

Image by tammyatWTI from Pixabay

States that Already Did Not Tax Military Retirement

The following states already do not tax military retirement pay at all: Alabama, Connecticut, Hawaii, Illinois, Iowa, Kansas, Louisiana, Maine, Massachusetts, Michigan, Minnesota, Missouri, New York, North Dakota, Ohio, Pennsylvania, West Virginia and Wisconsin.

Additionally, the following states only partially tax military retirement income, allowing for some credits or exemptions: Colorado, Delaware, Georgia, Idaho, Kentucky, Maryland, New Jersey, Oklahoma, Oregon and South Carolina.

Finally, some states don’t tax any income, including military benefits: Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming. ” ~ SmartAssett

We have updated this information in our newest publication, the Smart Military Retirement Location Guide, where you can find a lot of great information on locations across the United States that are ideal for military retirees to settle down.  Check it out!

Source: Smart Assett | These Five States Just Eliminated Income Tax on Military Retirement

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