Military retirement pay in Alabama
Varies
Does Alabama Tax Military Retirement Pay?
Short answer: No. Alabama fully exempts U.S. military retired pay from state income tax. Other retirement income: Defined-benefit pensions (public and private) are fully exempt. Taxpayers 65+ may also exclude the first $6,000 per person of other taxable retirement income such as 401(k) and IRA withdrawals.
Military retired pay is taxable federally; VA disability compensation isn't taxed federally or by any state.
Records to keep: Keep your state return, W-2s and 1099s (1099-R, SSA-1099), and any state credit worksheets. Check your state revenue department's current-year instructions before you file.
Military retirement pay in Alabama
Varies
Individuals / Personal Taxes
No. Alabama fully exempts U.S. military retired pay from state income tax. Other retirement income: Defined-benefit pensions (public and private) are fully exempt. Taxpayers 65+ may also exclude the first $6,000 per person of other taxable retirement income such as 401(k) and IRA withdrawals.
Business justification
No. Alabama fully exempts U.S. military retired pay from state income tax. Other retirement income: Defined-benefit pensions (public and private) are fully exempt. Taxpayers 65+ may also exclude the first $6,000 per person of other taxable retirement income such as 401(k) and IRA withdrawals. Military retired pay is taxable federally; VA disability compensation isn't taxed federally or by any state.
Category
- Personal Tax Deductions