KEY TAKEAWAYS
- Veterans rated 100% permanent, including those paid at 100% through individual unemployability, and Gold Star spouses can exempt 50% of the first $200,000 of their home’s actual value. Apply to your county assessor by July 1.
- Military retirees under 55 can subtract up to $15,000 of retired pay through tax year 2028. At 55 the regular pension subtraction takes over: $20,000, or $24,000 at 65 and older.
- Colorado National Guard members get up to 100% of in-state tuition waived at state schools. Since July 1, 2026, HB26-1386 splits the cost between the school and the state.
- Residents rated 50% or more can get a free lifetime small game hunting and fishing license and a free Independence Pass to state parks.
- Every veteran and active-duty member gets free state park entry in August and on Veterans Day, and Disabled Veteran and Purple Heart plates get in free year-round.
- Colorado Income Tax for Veterans and Military Retirees
- Colorado Property Tax Exemption for Disabled Veterans
- Education Benefits: Guard Tuition Waiver, DTAP and the GI Bill
- State and Private Hiring Preference
- State Parks, Hunting and Fishing
- License Plates and Vehicle Taxes
- Colorado Veterans Community Living Centers
- Colorado Veterans Cemeteries
- Benefits for Surviving Spouses and Families
- How to Apply for Colorado Veteran Benefits
- Frequently Asked Questions
Colorado does not exempt military retired pay the way many states now do, but it softens the tax for every age group, and its property tax exemption reaches more disabled veterans than it used to. Voters approved Amendment G in 2024, so veterans paid at 100% through individual unemployability now qualify for the homestead exemption alongside those rated 100%. The National Guard tuition waiver changed again on July 1, 2026, and some older guides still describe the old capped tuition assistance program. This guide covers what Colorado offers in 2026, who qualifies and where to apply.
Colorado Income Tax for Veterans and Military Retirees
Colorado taxes military retired pay but lets you subtract part of it. Which subtraction you use depends on your age at the end of the tax year, according to the Department of Revenue:
| Age at end of tax year | Subtraction | Limit |
|---|---|---|
| Under 55 | Military retirement subtraction | $15,000 a year, tax years 2022 through 2028 |
| 55 to 64 | Pension and annuity subtraction | $20,000 a year |
| 65 and older | Pension and annuity subtraction | $24,000 a year |
Both are claimed on the Subtractions from Income Schedule, DR 0104AD. The pension subtraction is shared with other retirement income such as IRAs, and taxable Social Security now takes room from the same cap, so a retiree with several income sources may not get the full amount for military pay. Starting in 2025, filers 55 to 64 with AGI up to $75,000 single or $95,000 joint can subtract all of their taxable Social Security, per the DOR guidance.
How the subtraction works in practice
Take a retiree who left after 20 years at 42 and draws $30,000 a year in retired pay. Until the year they turn 55, they subtract $15,000 and pay Colorado tax on the other $15,000. In the year they turn 55 they switch to the pension subtraction and can subtract up to $20,000, as long as no other pension or Social Security is using the same cap. At 65 the cap rises to $24,000. A retiree drawing $24,000 or less who has no other retirement income pays no Colorado tax on retired pay from 65 on. Retirees who expect to work a second career in Colorado should plan for the $15,000 years, since the rest of their retired pay is taxed at the same flat rate as wages.
Survivors receiving pension or annuity benefits because of a death, which includes SBP annuities, can subtract up to $20,000 even if they are under 55. Our Survivor Benefit Plan guide explains the annuity, and the military retirement pay calculator estimates your pension.
Active-duty pay and military spouses
- Colorado residents: active-duty pay is generally taxable, but pay earned in a designated combat zone is excluded as it is federally.
- Service members from other states stationed in Colorado: your military pay is taxed by your home state, not Colorado.
- Military spouses: under the Military Spouses Residency Relief Act, a spouse who moved to Colorado with a service member on orders can keep their home-state domicile.
VA disability compensation and DIC are tax-free under federal law and are not taxed by Colorado.
Colorado Property Tax Exemption for Disabled Veterans
The property tax exemption for veterans with a disability and Gold Star spouses exempts 50% of the first $200,000 of actual value of your primary residence. The state reimburses the county, so local services are not cut.
| Home actual value | Exempt value | Value taxed |
|---|---|---|
| $200,000 | $100,000 | $100,000 |
| $400,000 | $100,000 | $300,000 |
| $600,000 | $100,000 | $500,000 |
Who qualifies
- Veterans who served on active duty, were honorably discharged and have a service-connected disability rated 100% permanent, either by rating or through individual unemployability. TDIU was added by Amendment G, which voters approved in November 2024.
- Gold Star spouses: spouses of service members who died in the line of duty, or of veterans whose death resulted from a service-connected injury or disease.
- Surviving spouses of veterans who had the exemption, if the home remains their primary residence.
How to apply
- You must have owned and lived in the home as your primary residence since January 1 of the year you apply. A home owned by your spouse, or held in a trust for estate planning, can qualify.
- Veterans in a hospital, nursing home or assisted living still qualify if the home is empty or a spouse or dependent lives there.
- Send the application to your county assessor so it is postmarked or delivered by July 1. Late applications can be accepted through August 1 with good cause.
The exemption follows the person and the home together. If you move, you file a new application for the new home by July 1 of the next year, because eligibility is set as of January 1. A veteran who buys a home in March, for example, files the following spring. The county assessor decides Gold Star spouse claims; for veterans, the application asks for a VA letter showing the permanent 100% rating or the individual unemployability award.
Ratings below 100% get nothing from this program, so a TDIU award or a permanent 100% rating is worth real money in Colorado. Our 100% VA disability guide explains what a permanent rating means.
Education Benefits: Guard Tuition Waiver, DTAP and the GI Bill
National Guard tuition waiver
The Colorado National Guard Tuition Waiver covers up to 100% of in-state tuition at state-approved Colorado colleges for undergraduate and graduate courses in an approved degree plan. Beginning July 1, 2026, HB26-1386 replaced SB25-247: the school and the state now split the cost 50/50, and per-school enrollment caps are gone.
| Program level | Credit hour limit |
|---|---|
| Associate | 65 |
| Bachelor’s | 130 (145 combined with an associate) |
| Master’s | 60, with DMVA approval |
| Doctoral | 90 |
| Professional | 150 |
| Certificate | One program |
It does not cover mandatory fees, books, out-of-state tuition or non-degree courses. You must be accepted to the school, keep in-state residency, file a FAFSA or CASFA (you do not need to receive aid), have finished basic training, stay in good standing and apply in each term’s window: June 1 to 20 for fall, November 1 to 20 for spring and April 1 to 20 for summer.
Dependent Tuition Assistance Program
The Dependent Tuition Assistance Program covers tuition and on-campus room and board for dependents of Colorado National Guard members killed or disabled in the line of duty, and for dependents of prisoners of war and service members missing in action. Applications usually run from March 1 to June 30. A 2026 bill to give a full tuition waiver to dependents of other qualified veterans, SB26-067, was postponed indefinitely.
In-state tuition and the GI Bill
Federal law requires public colleges to charge in-state rates to veterans and family members using the Post-9/11 or Montgomery GI Bill, VR&E, the Fry Scholarship or Chapter 35 while they live in the state. Our Post-9/11 GI Bill guide explains the benefit, and GI Bill transferability covers passing it to a spouse or child.
State and Private Hiring Preference
Veterans’ preference for state jobs
Colorado adds preference to passing scores for eligible veterans in competitive state hiring, with extra preference for veterans receiving compensation or disability retirement for a line-of-duty disability. Eligibility depends on service during an authorized period, a qualifying campaign badge or service medal, or a service-connected disability. Preference does not apply to promotions. Attach your DD-214 (member 4) and, if disabled, your VA letter, as the state careers site explains.
Private employer preference
Under HB21-1065, private employers may adopt a policy that prefers veterans, and spouses of service members killed in the line of duty, over equally qualified applicants without it counting as discrimination. Employers can limit the preference to veterans discharged within five years or disabled veterans within ten years. If you run your own business, see our guide to benefits for veteran-owned businesses.
State Parks, Hunting and Fishing
Colorado Parks and Wildlife offers some of the best outdoor benefits for veterans in the West.
| Benefit | Who qualifies | What you get |
|---|---|---|
| Disabled Veteran or Purple Heart plates | Colorado residents with current DV or Purple Heart plates | Free state park entry year-round with no pass; the veteran must be in the vehicle |
| Independence Pass | Colorado residents rated 50% or more, with loss of use of a hand or foot, blind in both eyes, or Purple Heart recipients | Free unlimited state park access |
| Military August Pass | Active-duty members and veterans not dishonorably discharged | Free park entry for all of August (admission only) |
| Veterans Day | Veterans and active-duty members | Free park admission on November 11 |
Sources: CPW and the Colorado Division of Veterans Affairs. The division says Independence Pass holders over 64 also get discounted weekday camping.
Hunting and fishing
- Free lifetime combination license: Colorado residents with a service-connected rating of 50% or more, and Purple Heart recipients, get a free lifetime small game hunting and fishing license, per CPW. Big game licenses are separate.
- Active duty: members stationed in Colorado on permanent orders, and their families, buy licenses at resident rates. Guard and Reserve status does not count.
- Deployed members can request the preference points they would have earned while overseas.
- Wounded Warrior and Safe Harbor: CPW sets aside 100 female and 100 male deer, elk and pronghorn licenses for members in those programs who are assigned to a military treatment facility.
All veterans also get a free lifetime federal pass; see our national park pass guide.
License Plates and Vehicle Taxes
- Disabled Veteran plates: veterans with a service-connected, permanent disability rated 50% or more get one free set with form DR 2002, a DD-214 and a VA letter, ordered through the county motor vehicle office. The plates do not by themselves allow disability parking; that needs form DR 2219.
- Nonresident active duty: members assigned to Colorado who keep another state’s residency are exempt from specific ownership tax. File form DR2667 with each registration or renewal. A 2026 bill, HB26-1200, dropped the affidavit requirement for certain exemptions for members serving outside the U.S.
A 2026 bill to give qualified veterans free standard and military plates, HB26-1057, was deemed lost, according to the Legislative Council’s 2026 summary. County details are on Larimer County’s military plate page.
Colorado Veterans Community Living Centers
The Colorado Department of Human Services runs five Veterans Community Living Centers:
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| Center | Location | Secure memory care |
|---|---|---|
| Veterans Community Living Center at Fitzsimons | Aurora | Yes |
| Bruce McCandless Veterans Community Living Center | Florence | Yes |
| Veterans Community Living Center at Homelake | Monte Vista | Dementia care; 48 assisted living-style cottages |
| Veterans Community Living Center at Rifle | Rifle | Yes |
| Spanish Peaks Veterans Community Living Center | Walsenburg | Yes |
Honorably discharged veterans, their spouses or widows, and Gold Star parents are eligible if they meet the medical criteria. All five centers offer dementia care. VA may also pay toward care for veterans with high ratings; our VA health care enrollment guide is the place to start.
Colorado Veterans Cemeteries
Colorado runs one state veterans cemetery, the Veterans Memorial Cemetery of Western Colorado in Grand Junction. Because it is a state cemetery, the veteran must have been a Colorado resident when entering active duty or at death. It offers columbarium niches, in-ground niches, vault burial and conventional graves, and you can pre-register with VMC Form 01, your discharge papers and proof of residency, per the cemetery information sheet.
Colorado also has three VA national cemeteries, all listed as open by VA: Fort Logan in Denver, Fort Lyon in Las Animas and Pikes Peak in Colorado Springs. Burial, a headstone and a flag are free for eligible veterans; see our VA burial allowance guide for what VA pays toward other costs.
Benefits for Surviving Spouses and Families
- Property tax: Gold Star spouses qualify in their own right, and surviving spouses of veterans who had the exemption can keep it on their primary residence.
- Income tax: survivors under 55 receiving SBP or other death benefits can subtract up to $20,000.
- Education: dependents of Guard members killed or disabled on duty, and of POWs and MIAs, can use the Dependent Tuition Assistance Program.
- Veterans homes: widows and Gold Star parents are eligible for the community living centers.
- State jobs: some spouses and surviving spouses can claim preference; ask the hiring agency.
Federal survivor benefits often matter more. See our guides to VA benefits for a veteran’s widow and CHAMPVA.
How to Apply for Colorado Veteran Benefits
- Gather documents: your DD-214 (member 4 copy) and a VA benefit summary letter showing your rating, or your IU award.
- See a County Veterans Service Officer for free help with VA claims and state benefits; the Colorado Division of Veterans Affairs lists them by county.
- File the property tax exemption with your county assessor by July 1.
- Claim the retirement subtraction on DR 0104AD with your state return.
- Apply for the Independence Pass and combination license through CPW with your VA letter.
Never pay a company to file an initial VA claim. Our guide to VA disability claim help explains who can legally charge, and the VA disability ratings guide explains how ratings are set.
Comparing states? See our guides to New Mexico, Kansas, Utah and Wyoming.
RELATED READING
Property tax exemptions, retirement pay rules and state programs to the south.
Eligibility, entitlement, funding fees, and how the $0-down program works.
Property tax breaks, income tax exemptions and state programs in all 50 states.
Frequently Asked Questions
Yes, but with a subtraction at every age. Retirees under 55 can subtract up to $15,000 a year through tax year 2028. From 55 to 64, military pay falls under the general pension subtraction of up to $20,000, and at 65 and older the limit is $24,000. Social Security and other pensions share that cap.
Yes. Since Amendment G passed in November 2024, veterans with a 100% permanent disability through individual unemployability qualify alongside those rated 100%. The exemption takes 50% off the first $200,000 of your home’s actual value. File with your county assessor by July 1.
It removes up to $100,000 of actual value from your home’s taxable value: 50% of the first $200,000. A $400,000 home is taxed as if it were worth $300,000. Your dollar savings depend on your county’s mill levy.
Yes, up to 100% of in-state tuition for eligible members, within credit-hour limits. What changed on July 1, 2026, under HB26-1386 is who pays: the college and the state now split the cost 50/50. Fees and books are not covered, and you must apply every term.
Every veteran and active-duty member gets free entry in August and on November 11. Year-round, Colorado residents with Disabled Veteran or Purple Heart plates get in free when the veteran is in the car, and residents rated 50% or more can get the free Independence Pass.
Colorado residents with a service-connected disability rating of 50% or more, and Purple Heart recipients, can get a free lifetime combination small game hunting and fishing license from Colorado Parks and Wildlife. Big game licenses are still purchased and drawn separately.
This article is provided by USMilitary.org, an independent educational resource. We are not affiliated with the Colorado Division of Veterans Affairs, the Colorado Department of Revenue, Colorado Parks and Wildlife, the Department of Defense, VA, or any government agency. Amounts and program rules change; confirm current terms with the Colorado Division of Veterans Affairs or your County Veterans Service Officer.