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Colorado Income Tax Exclusion for Military Disability Retirement Pay

Colorado Department of Revenue
Full exclusion from taxable income

Military disability retirement pay you receive as a pension, annuity or similar allowance for an injury or sickness resulting from active service is not included in taxable income. The same treatment covers VA disability compensation and pension payments to veterans or their families, grants for homes designed for wheelchair living, grants for motor vehicles if you lost your sight or the use of limbs, and benefits under a dependent-care assistance program.

Check eligibility

How to apply

There is nothing to apply for. Leave these payments out of the income you report.

What you'll need

Your VA award letter showing the payments and what they are for.

Eligibility

  • You are filing a Colorado income tax return
  • You receive military disability retirement pay or another VA disability benefit for an injury or sickness resulting from active service

Source

Official source