Sen. Buckson Introduces Legislation to Increase Military Pension Tax Exemption

Bipartisan legislation has been introduced in advance of Tuesday’s start of the Delaware General Assembly that would increase Delaware’s exclusion of military retirement pay from state income taxes. Senate Bill 219 was introduced by Senator Eric Buckson (R-South Dover) – it would provide meaningful tax relief to veterans who have served our country. The measure would phase in an increased exemption for military pensions over several years – ultimately raising the exclusion to $25,000 for all military retirees – regardless of age – beginning in the tax year 2029. The current maximum pension exclusion is $12,500.

Additional information from the DE Senate – Republican Caucus:

“Delaware owes a debt of gratitude to the men and women who served our nation, and this bill is a practical way to honor that service,” said Senator Buckson. “Military retirees earned these benefits through years of sacrifice, and they should not be penalized for choosing to live in Delaware after their service.”

Under the proposal, the military pension exclusion would increase incrementally starting in 2027, guaranteeing a responsible, phased approach while moving Delaware closer to parity with other states. Of the 41 states that have a state income tax, 27 fully exempt military retirement pay and 12 others offer partial exemptions.

Senator Buckson previously introduced similar legislation in 2024, continuing a multi-year effort to make Delaware more welcoming and competitive for veterans and military families.

“This is also about keeping experienced, highly skilled veterans here in our communities,” Senator Buckson added. “When veterans retire from military service, many are still in the prime of their working years. A more competitive tax structure helps Delaware attract and retain those leaders, workers, and mentors.”

SB 219 builds on prior legislative actions taken in 2022 and 2024 that expanded Delaware’s military pension exclusion and clarified eligibility to include service in the Space Force, Coast Guard, National Guard, and the commissioned corps of the National Oceanic and Atmospheric Administration and the U.S. Public Health Service.

SB 219 has been assigned to the Senate Executive Committee and is expected to receive committee consideration in the coming weeks. 

The General Assembly will reconvene in regular session on Tuesday, January 13, 2026.