A retired servicemember may claim one of two subtractions for all or part of the military retirement benefits that are included in their federal taxable income. The subtraction that may be claimed depends on the retired servicemember's age at the end of the tax year. For more information on the following subtractions, review the guidance publication Income Tax Topics: Military Servicemembers.
Retired Servicemembers Under 55 Years of Age
If a retired servicemember is under 55 years of age at the end of the tax year, they may claim the military retirement subtraction on line 5 or 6 of the Subtractions from Income Schedule (DR 0104AD) for military retirement benefits included in their federal taxable income, subject to the following limitations based on the tax year.
Military Retirement Subtraction Limits
| Tax Year | 2019 | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|---|
| Limit | $4,500 | $7,500 | $10,000 | $15,000 | $15,000 |
Retired Servicemembers Age 55 or Older
If a retired servicemember is at least 55 years old at the end of the tax year, they may claim the regular pension and annuity subtraction on line 3 or 4 of the Subtractions from Income Schedule (DR 0104AD) for military retirement benefits included in their federal taxable income.