Pennsylvania veteran taxes

Military retired pay in Pennsylvania

Exempttax year 2025Sources 1, 2, 3

Pennsylvania does not tax military retired pay. The Department of Revenue’s 2025 PA-40 instructions list military pension benefits as income not taxable for Pennsylvania personal income tax purposes and exclude retired or retainer pay of a member or former member of a uniformed service computed under chapter 71 of title 10, U.S. Code, with no age, cap or income test.

Survivor Benefit Plan annuities

Check with the stateSources 4, 2, 3

The Department of Revenue’s 2025 PA-40 instructions and Personal Income Tax Guide do not name Survivor Benefit Plan annuities. They say payments to the estate or designated beneficiary of a plan participant by reason of the participant’s death are not taxable, and they exempt uniformed-service retired pay, but they do not say whether military survivor annuities fall under these rules.

Property tax relief for disabled veterans

Exemption or creditSources 5, 6, 7

Pennsylvania exempts from all real estate taxes the building, and the land it stands on, that a resident veteran occupies as a principal dwelling if the veteran was honorably discharged for service in a war or armed conflict, is blind, paraplegic or has lost two or more limbs as a result of that service or has a service-connected disability the VA declares total or 100% permanent, owns the dwelling solely or with a spouse, and has a financial need determined by the State Veterans’ Commission (51 Pa.C.S. § 8902). The Department of Military and Veterans Affairs presumes need at annual income of $114,637 or less (from January 1, 2025) and also lists total disability individual unemployability.

• Wartime service is required: service during a period of war as determined by the VA; the Department of Military and Veterans Affairs says operation or service-specific expeditionary medals can also establish it.
• Applicants above $114,637 may still show need when allowable monthly expenses exceed monthly household income; the Commission reviews need at least once every five years.
• Veterans apply through the County Director of Veterans Affairs; the county assessment board grants the exemption on the Commission’s certification of need.

Vehicle registration for disabled veterans

Fee waiver or discountSources 8, 9, 10

Pennsylvania charges no title or registration fee for vehicles of totally disabled veterans whose service-connected disability is certified by their service unit or the VA, or of veterans who lost a limb or eye or became partially paralyzed while serving (75 Pa.C.S. § 1901(b)(4), (6)); only one passenger car or truck of not more than 9,000 pounds registered gross weight may be registered to a person under these provisions (§ 1901(d)(2)). PennDOT issues a Severely Disabled Veteran plate to veterans with a 100% service-connected disability and a Disabled Veteran registration plate to veterans with a disability certified by their service unit or the VA.

• The limb, eye or partial paralysis exemption in § 1901(b)(6) was added by Act 60 of 2024 (P.L.737, No.60, approved July 15, 2024, effective in 5 months).
• PennDOT’s plate page does not state plate fees; a Severely Disabled Veteran motorcycle decal is also issued to veterans with a 100% service-connected disability.
• The statute does not provide for a surviving spouse.