Active-duty pay
Taxed
Active-duty pay taxable; combat zone exempt.
State Guide · UT
Utah — Military Tax Treatment
Utah fully exempted military retirement in 2021. Active duty and Guard pay are taxable. If you're a Guard member retiring in Utah, the payoff comes when you start drawing retirement at 60.
Tax treatment at a glance
Guard & Reserve drill pay
Taxed
Guard and Reserve drill pay is taxable Utah income. The retirement exemption (2021) does not extend to Guard drill pay.
Military retirement pay
Fully Exempt
Military retirement pay fully exempt as of 2021.
The numbers · verified for tax year 2025
Top marginal rate
4.5%
Retirement-pay exemption
Full
Utah taxes military retirement pay at its flat rate but grants a nonrefundable Military Retirement Credit equal to 4.5% of taxable military retirement pay, which fully offsets the tax on that income — no age threshold or dollar cap. It cannot be combined with the general Retirement or Social Security credit in the same year.
Standard deduction
Utah has no conventional standard deduction; it computes tax on federal AGI and applies a nonrefundable Taxpayer Tax Credit that phases out at higher incomes. HB 106 cut the flat rate from 4.55% to 4.5% for 2025.
VA disability compensation
Always tax-free
Federally tax-free under 38 USC § 5301. No state taxes VA disability compensation as income — Utah included.
Survivor Benefit Plan (SBP)
Follows retirement
Utah exempts military retirement — SBP annuities are generally exempt.
Federal rules that override state law
SCRA — Servicemembers Civil Relief Act
Active-duty servicemembers pay state income tax only to their state of legal domicile — not the state where they are stationed. If you are from Texas and stationed in Utah, Utah cannot tax your military pay. This applies during all active duty periods and during Guard/Reserve mobilizations on federal (Title 10) orders.
MSRRA — Military Spouses Residency Relief Act
Military spouses can maintain their home-state domicile even when living in a different state due to their servicemember's orders. A spouse who is a Texas resident following their servicemember to Utah can keep Texas as their tax domicile and avoid Utah state income tax on their wages.
Guard & Reserve — the SCRA gap
SCRA pay protections apply during federal (Title 10) activation orders. During routine drill weekends and state-only activations, Guard and Reserve members are state residents serving in their home state — SCRA does not protect their drill pay from state income tax. Whether Utah exempts that pay is the state-specific question answered above.
Filing watch-outs
- 01Retirement exemption: TC-40, Part 2 military retirement deduction
- 02Guard members: drill pay is taxable UT income
Veteran-specific tax benefits
Disabled veteran property tax abatement.
Official authority
https://tax.utah.gov/ ↗State tax law changes annually. Verify current rules with the Utah Department of Revenue before making any tax decision.
Utah military tax — common questions
Does Utah tax military retirement pay in 2026?
Utah fully exempts military retirement pay. Military retirement pay fully exempt as of 2021.
Does Utah tax active-duty military pay?
Utah taxes active-duty military pay for state residents. Active-duty pay taxable; combat zone exempt. Under the SCRA, Utah can only tax the military pay of service members who are legally domiciled in Utah — not those merely stationed there.
Does Utah tax National Guard and Reserve drill pay?
Utah taxes Guard and Reserve drill pay. Guard and Reserve drill pay is taxable Utah income. The retirement exemption (2021) does not extend to Guard drill pay.
Is VA disability compensation taxed in Utah?
No. VA disability compensation is federally tax-free under 38 U.S.C. § 5301, and no state — including Utah — taxes it as income.
If I'm stationed in Utah but claim another state, can Utah tax my military pay?
No. Under the Servicemembers Civil Relief Act (SCRA), active-duty pay is taxable only by your state of legal domicile, not the state where you are stationed. If your domicile is elsewhere, Utah cannot tax your active-duty military pay. Military spouses get the same protection under the MSRRA.
Related tools
Other state guides