Does Alabama tax military retirement pay?
Not taxed
No. Alabama lists military retirement pay among the kinds of income exempt from Alabama income tax.
In the state's own words
Copied word for word from the official document linked below each quote:
“Income Exempt from Alabama Income Taxation”
“Military retirement pay”
Other retirement income in Alabama
Partly. Alabama exempts payments from qualifying defined benefit pension plans, and people 65 or older can exclude up to $6,000 of other taxable retirement income, such as IRA or 401(k) withdrawals. The Alabama pension page has the details, and the Alabama Social Security page covers Social Security. No. Alabama lists federal Social Security benefits as income that is exempt from Alabama income tax.
Before you file or move
This page is about state income tax only. Your federal return has its own rules for military retired pay, and VA disability compensation is a separate benefit from retired pay. State rules change, and the details (age, years, which kinds of pay qualify, survivor benefits) matter. Check with the Alabama Department of Revenue before you file or move.
Other states in the same group
Check our work
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- Income Exempt from Alabama Income TaxationAlabama Department of Revenue. Read on November 13, 2026.