KEY TAKEAWAYS
- Delaware residents can exclude up to $12,500 of military retired pay from state income tax for 2026, at any age.
- A 2026 law (Senate Bill 219) raises that exclusion to $15,000 in 2027, $20,000 in 2028 and $25,000 in 2029.
- Veterans rated 100% permanent and total, or paid at 100% for unemployability, who have lived in Delaware for three years get a credit for all of their school district property tax.
- Resident veterans rated 60% or higher don’t need a hunting, fishing or trapping license, and veterans pay half price for an annual state park pass.
- Delaware has no sales tax, which helps retirees on a fixed income, and it doesn’t tax Social Security.
- Delaware Veteran Benefits by Disability Rating
- Delaware Income Tax Benefits for Veterans
- Disabled Veterans School Tax Credit
- Education Benefits
- Employment Benefits
- Driver’s Licenses and License Plates
- Hunting, Fishing and State Parks
- Delaware Veterans Home
- Delaware Veterans Memorial Cemeteries
- Surviving Spouse and Family Benefits
- Emergency Help and Other Benefits
- How to Claim Delaware Veteran Benefits, Step by Step
- Frequently Asked Questions
Delaware is small, but its veteran benefits cover the big three: a partial income tax break on military retired pay that grows every year through 2029, a property tax credit that wipes out the school portion of the bill for 100% disabled veterans, and no sales tax for anyone. Around those sit tuition programs for Guard members and the children of fallen service members, a 144-bed veterans home in Milford, two state veterans cemeteries and license and park discounts. This guide covers each benefit, who qualifies and how to apply in 2026.
Delaware Veteran Benefits by Disability Rating
| Your status | What you get in Delaware |
|---|---|
| Any honorably discharged veteran | Military retired pay exclusion (up to $12,500 in 2026), free veteran indicator on your license, state hiring preference, half-price annual park pass, veterans home and state cemeteries |
| Service-connected disability (any rating) | 10-point state hiring preference instead of 5 |
| 60% or higher | No hunting, fishing or trapping license needed |
| 100% P&T, or 100% for unemployability (3-year resident) | Credit for 100% of school district property tax on your home |
| Child of a service member killed on duty, or of a POW/MIA | Up to four years of free tuition and fees at a Delaware state college |
School district tax is often a large share of a Delaware property tax bill, so the 100% line is worth a lot. Our 100% VA disability guide explains the difference between a 100% schedular rating, individual unemployability and permanent and total status.
Delaware Income Tax Benefits for Veterans
Military Retired Pay: Up to $12,500 Excluded in 2026
Delaware lets residents exclude up to $12,500 of a U.S. military pension from state income tax. Under Senate Bill 329, signed in September 2024 and retroactive to tax year 2022, residents under 60 get the greater of a $2,000 general pension exclusion or up to $12,500 of military pension; at 60 and older, the $12,500 exclusion covers pensions and other eligible retirement income combined. The law defines military pension to include all the uniformed services — the Army, Navy, Air Force, Marine Corps, Space Force, Coast Guard, National Guard, and the NOAA and Public Health Service commissioned corps.
Bigger Exclusion Starting in 2027
Senate Bill 219, passed by the General Assembly on July 1, 2026 and signed by Gov. Matt Meyer, raises the military pension exclusion in steps regardless of age:
| Tax year | Military pension exclusion |
|---|---|
| 2026 | Up to $12,500 (current law) |
| 2027 | Up to $15,000 |
| 2028 | Up to $20,000 |
| 2029 and later | Up to $25,000 |
Lawmakers’ summaries also describe residency requirements for retirees 60 and older: three years for those who were Delaware residents before January 1, 2027, and five years for those who move in after that. Check the 2027 Delaware return instructions before you rely on the larger amount.
TSP, Survivors, Disability Pay and Social Security
- TSP: withdrawals from the Thrift Savings Plan are taxable in Delaware.
- SBP and other survivor annuities: survivors 60 and older can exclude up to $12,500; survivors under 60 up to $2,000. A survivor with a permanent disability can exclude another $2,000 if earned income is under $2,500 and adjusted gross income is $10,000 or less.
- Disability pay: military disability retirement pay for injury or sickness from service is generally excluded, and VA disability compensation and DIC are tax-free.
- Social Security: not taxed in Delaware.
- Active-duty pay: Delaware residents do pay state income tax on military pay; there’s no exclusion for it.
Disabled Veterans School Tax Credit
Delaware doesn’t have a general veterans’ property tax exemption. Its main benefit is a credit against 100% of the non-vocational school district property tax on your primary residence. You qualify if you:
- Are rated 100% permanent and total by VA, or are paid at the 100% rate for individual unemployability
- Have lived in Delaware for the past three years
- Own and live in the home as your primary residence
The credit doesn’t cover vocational school, county or municipal taxes. Apply by April 30 through your county assessment office with your driver’s license or state ID, proof of your VA rating, your Social Security card and the application; once approved, you don’t reapply each year, but you must pay the rest of your tax bill in full by the end of each tax year to keep the credit. A 2026 bill to lower the threshold to an 80% rating (House Bill 349) stalled in committee and didn’t become law.
Delaware also exempts one vehicle from registration fees for a disabled veteran if it was adapted with VA funds. Buying a home? A VA loan lets you buy with no down payment.
Education Benefits
Delaware National Guard Tuition Assistance
Delaware Guard members with at least six years of service in good standing can get up to 100% of tuition at a state-supported college, or the average in-state tuition at a private Delaware college, for one certificate, one associate degree and one bachelor’s degree. A master’s can be reimbursed once undergraduate funding has been paid. Eligibility lasts 15 years from when you start using it, funding depends on the state budget, and you must keep satisfactory academic progress (302-326-7012).
Free Tuition for Children of Fallen and POW/MIA Service Members
Children of a Delaware service member killed on active duty, a Delaware veteran who died from service-related causes, or a Delaware POW or MIA can get tuition and required fees covered for up to four years at a state-supported college. Private Delaware or out-of-state schools are allowed only in limited cases. The child must be 16 to 24 and a Delaware resident for at least three years before applying, and applies through the Delaware Higher Education Financial Aid Portal.
Diplomas and Military Kids
Veterans who left high school to serve in World War II, Korea or Vietnam can receive a diploma (302-739-2792). Delaware belongs to the Interstate Compact on Educational Opportunity for Military Children and recognizes Purple Star schools. For federal benefits, see our Post-9/11 GI Bill guide.
Employment Benefits
- State hiring preference: 5 points on passing exam scores for eligible veterans and certain spouses and survivors; 10 points for veterans with a service-connected disability.
- Seniority credit: up to three years of seniority credit for state employees who leave to serve.
- Military leave: state employees get 112.5 hours (37.5-hour week) or 120 hours (40-hour week) of paid leave a year for Guard or Reserve training, and a leave of absence for active duty plus 90 days after discharge.
- Pay differential: if military base pay is less than state base salary, the state pays the difference; request it within 90 days of release.
- Pension credit: state employees hired after July 1, 1976, can buy up to five years of military service credit at actuarial cost (302-739-4208).
- Licensing: provisional licenses for up to six months while an application is pending, and deployed members’ licenses stay active (302-744-4500).
Driver’s Licenses and License Plates
- Veteran indicator: free on your Delaware driver’s license or ID with an honorable discharge.
- Renewing while away: active-duty members and dependents can renew by mail, and there are no late fees if the license expired while you were out of state.
- Plates: 37 military and veteran designs, including Purple Heart ($10), Disabled American Veterans ($10, for a VA-documented service-connected disability from wartime or a conflict) and Honorably Discharged Veteran ($15). The Gold Star Family plate is free. Surviving spouses can keep the Purple Heart and DAV plates.
- New arrivals: service members reassigned to Delaware can have the titling fee waived if they submit orders within 90 days.
- CDL: the skills test is waived for those with two years of military vehicle licensing who apply within a year of an honorable discharge; the knowledge test is still required.
Hunting, Fishing and State Parks
- License exemption: honorably discharged resident veterans with a VA rating of 60% or higher don’t need a hunting, fishing or trapping license.
- Recent combat veterans: residents who served 90 days or more in Iraq or Afghanistan can get a one-time license exemption for 12 months after discharge, and a free state park pass for the same period (302-739-9200).
- Stationed in Delaware: nonresident active-duty members stationed in Delaware and nonresident Delaware Guard members pay resident license prices.
- Park pass: resident active-duty and Guard members, honorably discharged veterans and retirees with 20 years of service get 50% off the annual state park pass.
Delaware Veterans Home
The Delaware Veterans Home in Milford is a 144-bed skilled nursing home (302-424-6000; admissions 302-424-8572). To be admitted you generally need 180 days or more of active duty with an honorable discharge (or qualifying Guard or Reserve service), a year of Delaware residency before applying, and a need for skilled nursing care. Surviving spouses and parents of service members or veterans who died of service-connected causes can also apply.
Delaware Veterans Memorial Cemeteries
- New Castle County: 2465 Chesapeake City Road, Bear, 302-834-8046
- Sussex County: 26669 Patriots Way, Millsboro, 302-934-5653
Eligibility follows VA national cemetery rules, plus a Delaware connection: residency at death, at entry into service, or for three years or more in total.
Surviving Spouse and Family Benefits
Survivors 60 and older can exclude up to $12,500 of a Survivor Benefit Plan annuity, and DIC is tax-free. Surviving spouses can keep the Purple Heart and DAV plates, and children of fallen service members can use the state tuition program. For federal benefits, see our guide to VA benefits for surviving spouses.
Emergency Help and Other Benefits
- Veterans Trust Fund: emergency help with housing, utilities, medical bills and car costs for Delaware veterans with an honorable or general discharge; payments go straight to the provider (302-739-2792).
- Paraplegic veterans: a $3,000-a-year state pension for totally disabled resident veterans who have no voluntary control of either leg from a wartime-related disability.
- Free documents: copies of Delaware military records, one free certified death certificate for a VA claim, and free notary services for VA and benefits claims.
- VA health care: if you haven’t enrolled, apply online at VA.gov; our VA health care enrollment guide explains priority groups.
How to Claim Delaware Veteran Benefits, Step by Step
- Get your documents: your DD-214 and, for rating-based benefits, a current VA benefit summary letter.
- Contact the Delaware Office of Veterans Services (302-739-2792), whose service officers help with state and federal claims for free.
- Apply where each benefit is run: your county assessment office for the school tax credit (by April 30), your Delaware return for the pension exclusion, the DMV for plates and indicators, and Fish and Wildlife for license exemptions.
- Recheck each year: the pension exclusion grows in 2027, 2028 and 2029.
RELATED READING
Maryland Veteran Benefits: Complete State Guide →
Delaware’s neighbor also excludes part of military retired pay and fully exempts the homes of 100% disabled veterans.
100% VA Disability: Pay, Benefits and How to Qualify →
The rating that unlocks Delaware’s school tax credit.
Compare Delaware with every other state’s taxes, tuition and property tax benefits.
Frequently Asked Questions
Partly. For 2026, Delaware residents can exclude up to $12,500 of military retired pay from state income tax. Senate Bill 219, signed in 2026, raises the exclusion to $15,000 for tax year 2027, $20,000 for 2028 and $25,000 from 2029.
Veterans rated 100% permanent and total, or paid at the 100% rate for individual unemployability, who have lived in Delaware for three years get a credit for 100% of the non-vocational school district property tax on their primary residence. County and municipal taxes still apply. Apply through your county assessment office by April 30.
No. Delaware has no state or local sales tax, and it doesn’t tax Social Security benefits.
Honorably discharged resident veterans with a VA disability rating of 60% or higher are exempt from Delaware hunting, fishing and trapping license requirements. Residents who served 90 days or more in Iraq or Afghanistan can also get a one-time exemption for 12 months after discharge.
Yes. Honorably discharged veterans, retirees with 20 years of service, and resident active-duty and Guard members get 50% off the annual Delaware state park pass.
Yes. Thrift Savings Plan withdrawals are taxable in Delaware; the military pension exclusion applies to military retired pay, not TSP.
In Milford. It is a 144-bed skilled nursing home for eligible veterans with a year of Delaware residency, and for surviving spouses and parents of those who died of service-connected causes. Call 302-424-6000 or admissions at 302-424-8572.
This article is provided by USMilitary.org, an independent educational resource. We are not affiliated with the State of Delaware, the Delaware Office of Veterans Services, VA or any government agency. Benefits and eligibility rules change; confirm current details with the Delaware Office of Veterans Services, your county assessment office or the official Delaware state benefits summary before you apply.