Does Delaware tax military retirement pay?
Partly taxed
Partly. Delaware gives retired military under 60 a pension exclusion of up to $12,500, against $2,000 for other pensions at that age. At 60 or older the general exclusion of up to $12,500 of pension and eligible retirement income applies.
In the state's own words
Copied word for word from the official documents linked below each quote:
“IF YOU WERE UNDER 60 on December 31, 2025 and retired from the United States military and received pension income during the year, your exclusion equals $12,500 or the amount of your pension, whichever is less.”
“However, persons 60 years of age or older are entitled to a pension exclusion of up to $12,500 or the amount of the pension and eligible retirement income (whichever is less).”
Other retirement income in Delaware
Partly. Delaware taxes pensions, but people 60 or older can exclude up to $12,500 of pension and eligible retirement income each, and those under 60 up to $2,000 of pension income. The Delaware pension page has the details, and the Delaware Social Security page covers Social Security. No. Delaware does not tax Social Security, and it should not be included in your Delaware taxable income.
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 Delaware Division of Revenue before you file or move.
Other states in the same group
Check our work
The answer above comes from these documents. Follow the link and compare.
- 2025 Resident Personal Income Tax Instructions (PIT-RES)Delaware Division of Revenue. Read on November 13, 2026.
- Personal Income Tax FAQsDelaware Division of Revenue. Read on November 13, 2026.