Does Colorado tax military retirement?

Partly. Under 55, up to $15,000 per person is subtracted (through 2028). From 55, military retired pay uses the general pension subtraction of $20,000 (55–64) or $24,000 (65+).

Does Colorado tax Social Security?

Not at 65 or older. At 55–64, it's fully subtracted if federal AGI is $75,000 or less (single) or $95,000 or less (joint).

What is the Colorado senior property tax exemption?

Half of the first $200,000 of your home's value, if you're 65 and have owned and lived in the home for 10 consecutive years.

Colorado retirement taxes in 2026: Social Security, pensions and military retired pay

Short answer

Colorado has a flat 4.4% income tax, but it takes much of retirement income off the table by age. At 65 or older, all Social Security included in your federal income is subtracted, and you can subtract up to $24,000 of pensions, IRA and 401(k) income, though Social Security counts toward that $24,000. Military retirees under 55 can subtract up to $15,000 of retired pay (through 2028); from 55, the regular pension subtraction applies. Homeowners 65+ who've lived in their home 10 years get half of the first $200,000 of its value exempt from property tax.

Not tax advice. Rules change; confirm with the Colorado Department of Revenue, your county assessor or a tax professional.

Colorado at a glance (2026)

	Colorado
State income tax	Flat 4.4% (2025; 2026 expected the same)
Social Security, 65+	Fully subtracted
Social Security, 55–64	Fully subtracted if federal AGI is $75,000 or less (single) or $95,000 or less (joint); otherwise counts toward the $20,000 cap
Pensions, IRA, 401(k)	Subtract up to $24,000 (65+) or $20,000 (55–64), minus any Social Security subtracted
Military retired pay, under 55	Subtract up to $15,000 per person (2022–2028)
Military retired pay, 55+	Use the pension subtraction ($20,000 / $24,000)
Senior homestead exemption	50% of the first $200,000 of value; 65+ and 10 years in the home
Disabled veteran exemption	50% of the first $200,000 of value; 100% P&T or Individual Unemployability
Average property tax	About 0.50% of home value a year

Income tax rate

Colorado's income tax is a flat 4.4% (tax year 2025). The 2026 booklet isn't published yet; secondary sources expect 4.4% again. Source: Colorado Department of Revenue, 2025 DR 0104 booklet.

Pensions, IRA and 401(k)

Subtract up to $24,000 at 65+ or $20,000 at 55–64. Social Security uses up this cap: the pension subtraction is the cap minus the Social Security you subtracted. A retiree 65+ with $24,000 or more of taxable Social Security gets no extra pension subtraction. Each spouse is figured separately, and unused amounts can't move between spouses. Source: Colorado Department of Revenue, 2025 DR 0104AD, line 4.

Military retired pay

Under 55 at year end: subtract the lesser of $15,000 or your taxable military retired pay, per person (tax years 2022 through 2028).
55 or older: use the regular pension subtraction ($20,000 or $24,000) instead.

So military retired pay is not fully exempt in Colorado. For a retiree in their 40s, everything above $15,000 is taxed at 4.4%. Sources: Colorado Department of Revenue, Retired Servicemembers; Income Tax Topics: Military Servicemembers (Feb 2025).

Senior property tax exemption (65+)

50% of the first $200,000 of your home's actual value is exempt.

Requirements: 65 on January 1, and you've owned and lived in the home as your primary residence for 10 consecutive years. For 2026: born on or before January 1, 1961, and in the home since January 1, 2016.
Deadline: July 15 (late filing until August 15, without appeal rights). A surviving spouse can keep it.
Moving restarts the 10-year clock. A temporary option for seniors who moved ends after tax year 2026.

Sources: Colorado Division of Property Taxation, senior exemption (2026); DOLA news release (Mar 4, 2026); SB26-116.

Disabled veterans

50% of the first $200,000 of your home's value is exempt if the VA rates you 100% permanent or you receive Individual Unemployability, with an honorable discharge and the home as your primary residence on January 1. No age or 10-year rule. Apply to your county assessor between January 1 and July 1. Surviving spouses and Gold Star spouses can qualify. You can't stack this with the senior exemption: one per couple. Source: Colorado Division of Property Taxation, veteran with a disability and Gold Star exemptions (2026).

Common mistakes

Counting the Social Security and pension subtractions separately. Social Security uses up the $20,000 / $24,000 cap.
Reading $75,000 / $95,000 as a deduction cap. They're income limits for the full Social Security subtraction at 55–64.
Assuming military retired pay is fully exempt. Under 55 it's capped at $15,000 per person.
Expecting to keep the senior exemption after a move. The 10 years start over. Military families who moved often miss this.
Mixing up deadlines: veterans July 1, seniors July 15.

On the ballot (Nov 3, 2026)

Colorado voters will decide two competing income tax measures on November 3, 2026: Proposition 136, which would cap the rate at 4.4%, and Amendment 87, which would create a graduated income tax. The flat 4.4% rate above applies until any change takes effect. Source: Colorado Politics (Oct 2, 2026); Ballotpedia (Aug 24, 2026).

Moving here?

Retiring to Colorado Springs: what your home sale leaves you, and the drive to the hospital and VA
PCS to Fort Carson: BAH, neighborhoods and gate drive times
Federal rules: Is military retirement taxable?

Chris Harris isn't licensed in Colorado. He'll introduce you to a vetted licensed agent there. Ask Chris →

FAQ

Does Colorado tax military retirement?: Partly. Under 55, up to $15,000 per person is subtracted (through 2028). From 55, military retired pay uses the general pension subtraction of $20,000 (55–64) or $24,000 (65+).
Does Colorado tax Social Security?: Not at 65 or older. At 55–64, it's fully subtracted if federal AGI is $75,000 or less (single) or $95,000 or less (joint).
What is Colorado's income tax rate?: A flat 4.4% (2025).
What is the Colorado senior property tax exemption?: Half of the first $200,000 of your home's value, if you're 65 and have owned and lived in the home for 10 consecutive years.

Sources

Last reviewed October 21, 2026. Not tax advice.