Military Retirement Pay Tax Subtraction
Full subtraction of military retirement pay attributable to pre-October 1, 1991 service from Oregon taxable income.
At a glance
- Benefit type
- Tax Benefits — Oregon
- Who it's for
- Veterans
- VA rating needed
- No rating requirement
- Where it applies
- Oregon
- Last verified
- May 12, 2026
What is Military Retirement Pay Tax Subtraction?
Military Retirement Pay Tax Subtraction is a Oregon tax benefits benefit for veterans. Full subtraction of military retirement pay attributable to pre-October 1, 1991 service from Oregon taxable income.
Who qualifies
- Available to any veteran
- Oregon residency
Who is eligible
Eligibility
Retired military service members with service prior to October 1, 1991. For mixed service periods, a prorated percentage applies (months before Oct 1, 1991 divided by total months of service). Pay earned on or after October 1, 1991 is NOT eligible.
How to apply for Military Retirement Pay Tax Subtraction
How to apply
Claim on Oregon state income tax return.
Verified information & sources
Last verified: May 12, 2026
Official source: oregon.gov
Compiled and fact-checked against the official source linked above. Benefit rules and dollar amounts change over time — always confirm current details at the official source before applying. A county Veterans Service Officer (VSO) is a free, accredited advocate who can review your eligibility and help you file at no cost.
Frequently asked questions about Military Retirement Pay Tax Subtraction
Who qualifies for Military Retirement Pay Tax Subtraction?▾
How do I apply for Military Retirement Pay Tax Subtraction?▾
Where can I verify Military Retirement Pay Tax Subtraction?▾
Other Oregon Tax Benefits
Military Disability Retirement Pay Exemption
Military disability retirement pay for personal injury or sickness from active service is excluded from Oregon taxable income.
Disabled Veteran Property Tax Exemption
Property tax exemption of $27,092-$32,512 of assessed value for veterans rated 40%+ (amounts increase 3% annually).
$27,092-$32,512 off assessed value
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