The 7 Most Generous States for Military Income Tax Breaks

Related: 12 Best Cities for Veterans: 2022

Among the many areas where the 50 states differ significantly in their tax practices is in how they treat military retirement benefits. Currently, more than two dozen states do not tax military retirement benefit income, according to an October 2022 analysis from TurboTax. In addition, eight states have no state income tax. It's worth noting that In all 50 states, Veterans Affairs disability compensation and Social Security disability payments are tax-free for veterans. However, a more limited number of states exempt both active duty military pay and retired military pay from income tax calculations. See the slideshow for a rundown of states that provide this double tax exemption for military members. (Image: Adobe Stock)