Veteran taxes by state
Tennessee veteran taxes
How Tennessee treats military retired pay and Survivor Benefit Plan annuities in its income tax, and its property tax and vehicle registration relief for disabled veterans — from the state’s own pages.
On this page5 sections
- Military retired pay
- No income tax
- SBP annuities
- No income tax
- Property tax
- Exemption or credit
- Vehicle registration
- Fee waiver or discount
Military retired pay in Tennessee
No income taxSources 1, 2, 3, 4
Tennessee does not tax military retired pay. The Department of Revenue says Tennessee has no individual income tax on wages, employer-sponsored retirement income or pension income (HIT-18); the Hall income tax, which reached only interest and dividends, was repealed for tax periods beginning on or after January 1, 2021.
Survivor Benefit Plan annuities
No income taxSources 1, 2
The Department of Revenue says pension income and distributions from annuities are not subject to Tennessee tax (HIT-18), so Survivor Benefit Plan annuities are not taxed by the state.
Property tax relief for disabled veterans
Exemption or creditSources 5, 6, 7, 8, 9
Tennessee’s Property Tax Relief program (Tenn. Code Ann. § 67-5-704) has the state pay or reimburse all or part of the local property taxes on a disabled veteran’s residence, figured on the first $175,000 of full market value. It is a reimbursement, not an exemption: the veteran still receives and pays the tax bill.
- Eligible veterans: a service-connected disability from paraplegia or permanent paralysis of both legs and lower part of the body, legal blindness, or loss or loss of use of two or more limbs; a 100% permanent total disability from having served as a prisoner of war; or a service-connected permanent and total disability as determined by the U.S. Department of Veterans Affairs. A dishonorable discharge bars relief.
- Relief applies to one primary residence. Applications go to the county trustee or the city collecting official; the veteran completes Form F-16 (a VA consent form), and the deadline is 35 days after the delinquency date.
- Surviving spouses of veterans whose death was service-connected and combat-related, and of soldiers who died while deployed in support of combat or peace operations, are also covered (Form F-16S).
Surviving spouse
The surviving spouse of a veteran who was eligible at death keeps the relief while not remarried, owning the property solely or jointly and using it exclusively as a home (Tenn. Code Ann. § 67-5-704(e)); the brochure adds that the spouse must have been married to the veteran at the time of death.
Vehicle registration for disabled veterans
Fee waiver or discountSources 10, 11, 12
The Department of Revenue lists no cost for the first Disabled Veteran license plate (Tenn. Code Ann. § 55-4-256) for a veteran with a VA letter showing a permanent and total rating, which the Department says always means compensation at 100 percent. A second plate costs $26.50 a year (initial fee $28.15) and later plates $26.50 a year (initial fee $29.80); the plate is offered for passenger vehicles and motorcycles.
- Vehicles sold, given or donated to disabled veterans who receive a VA automobile grant are exempt from sales tax, registration fees and local motor vehicle privilege taxes (effective March 5, 2018); the sales tax exemption covers only the price above the grant.
- The Department of Veterans Services says a veteran with a 100 percent permanent, total service-connected disability, or a former prisoner of war, is exempt from the county motor vehicle privilege tax (Tenn. Code Ann. § 5-8-102).
- The sources read do not provide for a surviving spouse.
Sources
Each source was read on October 28, 2026 on the state’s own site, the normal way. The numbers in the sections above point here.
- HIT-18 - Pension Income, Social Security, 401(k), and IRA Distributions
- Hall Income Tax
- Hall Income Tax Manual
- Taxes
- Property Tax Relief
- 2026 Property Tax Relief Brochure
- TCA Part 7 Classification and Assessment Tax Relief (Tenn. Code Ann. §§ 67-5-701 through 67-5-704)
- TCA Part 7 Classification and Assessment Tax Relief (Tenn. Code Ann. § 67-5-704(e))
- Property Tax Relief for Disabled Veterans
- Disabled Veteran
- Tax Manual for Military Members and Veterans
- County Motor Vehicle Privilege Tax