KEY TAKEAWAYS
- Hawaii does not tax military retired pay or SBP annuities, but active-duty pay for Hawaii residents is taxable, and the state’s top income tax rate is 11%.
- Guard and Reserve members can exclude up to $8,636 of drill and training pay on 2025 Hawaii returns.
- Property tax relief for disabled veterans is set by each county. Totally disabled veterans pay only a minimum tax on their home on Oahu, Hawaii Island and Kauai, Maui charges a flat $150 at 70% or higher, and Kauai covers veterans rated 80% or higher.
- Hawaii now has two state veterans homes: the Yukio Okutsu home in Hilo and the 120-bed Daniel K. Akaka home in Kapolei on Oahu.
- Veterans rated 100% get a $46 state registration fee exemption on one vehicle, and since July 2026 Oahu veterans 65 and older can skip the $20 Honolulu registration fee.
- Hawaii Veteran Benefits by Disability Rating
- Hawaii Income Tax for Veterans and Service Members
- Disabled Veteran Property Tax Exemptions by County
- Education Benefits
- Employment Benefits
- Vehicles, Licenses and Plates
- Hawaii State Veterans Homes
- Veterans Cemeteries
- Surviving Spouse Benefits
- VA Health Care in Hawaii
- How to Claim Hawaii Veteran Benefits, Step by Step
- Frequently Asked Questions
Hawaii is a mixed picture for veterans. Military retired pay is tax-free, totally disabled veterans pay almost nothing in property tax, and the state just opened a second veterans home on Oahu. But active-duty pay is taxed for residents, the income tax rate climbs to 11%, and most benefits beyond the basics are set county by county, so a veteran in Kailua and one in Kona can get different answers. This guide covers the state and county benefits, who qualifies and where to apply.
Hawaii Veteran Benefits by Disability Rating
| Your status | What you get in Hawaii |
|---|---|
| Any veteran (other than dishonorable) | Tax-free military retired pay, “Veteran” designation on your license, veteran license plates at the standard price, state and county veterans cemeteries |
| Veteran 65 or older on Oahu | Exemption from the $20 Honolulu county registration fee on one vehicle |
| Rated below 80% (Kauai) | Property tax exemption on up to $50,000 of taxable value |
| Rated 70% or higher (Maui) | Home taxed at a flat $150 a year |
| Rated 80% or higher (Kauai) | Home exempt from everything but the $150 minimum tax |
| Rated 100% | $46 state registration fee exemption on one vehicle |
| Totally disabled from active-duty injuries (Honolulu, Hawaii County) | Home exempt from all property tax except the county minimum tax; continues for an unremarried surviving spouse |
Because so much depends on the rating, it’s worth knowing exactly how VA reached yours. Our VA disability ratings guide explains how combined ratings work.
Hawaii Income Tax for Veterans and Service Members
Military Retired Pay and Survivor Annuities: Exempt
Hawaii doesn’t tax military retired pay. Survivor Benefit Plan, Reserve Component SBP and Retired Serviceman’s Family Protection Plan annuities are exempt too, and Hawaii doesn’t tax Social Security. That matters more in Hawaii than in most states, because the top income tax rate is 11%. Our military pension calculator estimates your retired pay, and our Survivor Benefit Plan guide explains the annuity.
Thrift Savings Plan withdrawals are a different story. Hawaii taxes TSP distributions, and TSP doesn’t withhold state tax, so plan for it.
Active-Duty Pay
Military pay that a Hawaii resident reports on their federal return is taxable in Hawaii. Combat pay that’s excluded federally stays excluded. Service members who are legal residents of another state and stationed in Hawaii on orders don’t owe Hawaii tax on their military pay.
Guard and Reserve Pay Exclusion
Members of the Hawaii National Guard and the Reserves can exclude part of their drill and training pay: the amount an E-5 with eight years of service earns for 48 drills and 15 days of annual training. That works out to $8,636 for tax year 2025, up from $8,082 for 2024. Pay above that is taxable.
Nonresident Military Spouses
A spouse who is in Hawaii only to be with a service member stationed there on orders, and who shares a legal residence in another state, may not owe Hawaii tax on wages earned in Hawaii.
VA Disability Compensation and DIC
VA disability compensation, Dependency and Indemnity Compensation, and VA grants for adapted homes and vehicles aren’t taxable, federally or in Hawaii.
Disabled Veteran Property Tax Exemptions by County
Hawaii has no statewide property tax. Each of the four counties sets its own exemptions, forms and deadlines, and they now differ more than they used to:
| County | Disabled veteran exemption | How and when to file |
|---|---|---|
| Honolulu (Oahu) | Home of a veteran totally disabled by injuries received on active duty is exempt from all property tax except the minimum tax | Form E-8-10.5 with a physician’s certificate; by June 30 for the first payment or December 31 for the second |
| Hawaii County (Big Island) | Home of a totally disabled veteran (active-duty injuries) is exempt except special assessments and the minimum tax; commercial portions don’t qualify | Form 19-73; by June 30 or December 31 |
| Maui County (Maui, Molokai, Lanai) | Veterans rated 70% or higher (“severely disabled”) pay a flat $150 a year on the home they own and live in | Form DFT-475; by December 31 for the next assessment year |
| Kauai | Rated 80% or higher: exempt except the $150 minimum tax. Rated below 80%: exempt on up to $50,000 of taxable value | Forms P-6 and P-3; by September 30 |
Sources: City and County of Honolulu, Hawaii County Real Property Tax Office, Maui County and Kauai County.
In Honolulu, Hawaii County and Kauai the exemption continues for the veteran’s widow or widower as long as they stay unmarried and keep living in the home; ask Maui’s Real Property Assessment Division about surviving spouses. Counties verify your rating with VA, so have your benefit summary letter ready, and file as soon as you’re rated so you don’t miss a deadline.
Buying first? Hawaii is one of the most expensive housing markets in the country, and a VA loan lets you buy with no down payment. Check the VA loan limits by county before you shop.
Education Benefits
Hawaii National Guard State Tuition Assistance Program (STAP)
STAP reimburses tuition for Hawaii National Guard members: up to 100% at a University of Hawaii community college and up to 50% at a four-year UH campus, subject to funding. To qualify you must be a Hawaii resident in the Guard with satisfactory performance, be enlisted, a warrant officer or an officer at O-3 or below, have an end of service date after your last class, and be enrolled in a degree program up to a bachelor’s. Apply online through the Guard; call 808-672-1019 with questions.
Resident Tuition for Veterans and Military Families
Hawaii’s public colleges charge resident tuition to service members stationed in Hawaii and their dependents, Guard and Reserve members in Hawaii-based units, veterans using VA education benefits, Fry Scholarship students, students using GI Bill benefits transferred by an active-duty service member, and veterans in VA’s Veteran Readiness and Employment program. That last group doesn’t need to establish Hawaii residency first. For the federal benefits themselves, see our Post-9/11 GI Bill guide.
Military Children
Hawaii belongs to the Interstate Compact on Educational Opportunity for Military Children, which helps students who move mid-year with enrollment, placement, sports eligibility and on-time graduation.
Employment Benefits
- Military leave for state and county employees: 15 days of paid military leave per calendar year, plus up to 15 more borrowed from the next year if needed.
- Military caregiver leave: state employees can take up to 26 weeks of unpaid leave in a 12-month period to care for a spouse, child, parent or next of kin seriously injured in the line of duty.
- Guard injuries: Hawaii National Guard members hurt, disabled or killed in the line of duty are covered by state workers’ compensation when federal benefits don’t apply.
- Job help: American Job Centers run by the state Workforce Development Division give veterans priority for job referrals and training, plus resume and interview help.
- State service credit: the Office of Veterans’ Services validates military service credit for the state Employees’ Retirement System.
Federal jobs in Hawaii, of which there are many, use the federal 5- and 10-point veterans’ preference.
Vehicles, Licenses and Plates
Hawaii has no state DMV; each county handles licenses and registration. The main veteran benefits:
- $46 state registration fee exemption: Hawaii residents with a 100% service-connected rating and an other-than-dishonorable discharge can take $46 off the state registration fee for one vehicle. Send a copy of your driver’s license, current registration and VA 100% letter to the Office of Veterans’ Services (ovs@hawaii.gov or fax 808-433-0385). OVS mails an original letter for the DMV, and you need a new letter every year.
- Honolulu fee exemption at 65: since July 1, 2026, Oahu veterans 65 and older with an other-than-dishonorable discharge can skip the $20 City and County registration fee on one noncommercial vehicle. Apply in person at a satellite city hall with Form CS-L(MVR)50B, proof of veteran status, age and ownership. It covers only the $20 county fee, according to OVS.
- VA-provided vehicles: specially adapted vehicles VA provides to service-connected disabled veterans are exempt from county vehicle taxes.
- Active duty: nonresident service members stationed in Hawaii are exempt from the vehicle weight tax on one vehicle (Honolulu and Hawaii County extend more exemptions to all vehicles they own), and resident active-duty, Guard and Reserve members get the weight tax exemption on one vehicle.
- Veteran license designation: available on a driver’s license, ID or permit with a DD-214 or other proof of an other-than-dishonorable discharge.
- Specialty plates: ten designs, including Veteran, Combat Veteran, Combat Wounded, Pearl Harbor Survivor, Former POW and Gold Star Family, at the same price as a standard plate.
Hawaii State Veterans Homes
| Home | Location | Details |
|---|---|---|
| Yukio Okutsu State Veterans Home | Hilo, Hawaii Island | 95 beds; skilled nursing, rehab, long-term, dementia and hospice care; 808-961-1500 |
| Daniel K. Akaka State Veterans Home | Kapolei, Oahu | 120 beds on seven acres; Hawaii’s largest post-acute and rehab facility for veterans |
For the Hilo home, veterans generally need an honorable discharge, a need for skilled or long-term nursing care, age 55 or older (younger applicants are considered case by case), Hawaii residency before entering service or for a year before applying, and the ability to pay their share of costs. Spouses, surviving spouses and Gold Star parents can be admitted when space allows. The Akaka home takes applications through a form on the OVS veterans homes page.
Veterans Cemeteries
The Hawaii State Veterans Cemetery in Kaneohe provides a gravesite, marker, liner, opening and closing of the grave and perpetual care. Family members share one grave at different depths, and cremated remains can go in the columbarium or a ground plot. Eligibility follows VA national cemetery rules. Contact the cemetery at 45-349 Kamehameha Highway, Kaneohe (808-369-3575).
Six county veterans cemeteries also take burials: East Hawaii No. II in Hilo, West Hawaii in Kailua-Kona, Kauai in Hanapepe, Maui in Makawao, Molokai in Hoolehua and Lanai in Lanai City. The National Memorial Cemetery of the Pacific in Honolulu is run by VA.
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Surviving Spouse Benefits
- Property tax: in Honolulu, Hawaii County and Kauai, the disabled veteran exemption continues for an unremarried widow or widower who keeps living in the home.
- Income tax: SBP, RCSBP and RSFPP annuities and DIC aren’t taxed in Hawaii.
- Veterans homes and cemeteries: spouses and surviving spouses can be admitted to the Hilo home when space allows and buried in state and county veterans cemeteries.
Federal benefits are usually the bigger piece. Our guide to VA benefits for surviving spouses covers DIC and the Survivors Pension, and CHAMPVA may provide health coverage.
VA Health Care in Hawaii
VA care in the islands runs through the VA Pacific Islands Health Care System, based at the Spark M. Matsunaga VA Medical Center at 459 Patterson Road in Honolulu, with clinics on the neighbor islands. Appointments are required; call 800-214-1306. Our VA health care enrollment guide explains how to sign up.
How to Claim Hawaii Veteran Benefits, Step by Step
- Get your documents: your DD-214 and, for disability-based benefits, a current VA benefit summary letter. OVS can provide free certified copies of a DD-214 it has on file.
- Contact the Office of Veterans’ Services: OVS helps with VA claims and appeals, state benefits and veterans home applications at no cost. The main office is at 459 Patterson Road in Honolulu, 808-433-0420, with offices on the neighbor islands.
- File with your county: property tax exemptions go to your county real property office by its deadline, and vehicle benefits go through your county DMV.
- Renew what needs renewing: the $46 registration letter must be requested again every year.
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Frequently Asked Questions
No. Hawaii does not tax military retired pay, and Survivor Benefit Plan, RCSBP and RSFPP annuities are also exempt. Active-duty pay is taxable for Hawaii residents, and TSP withdrawals are taxed.
It depends on the county and your rating. Honolulu and Hawaii County exempt the home of a veteran totally disabled by injuries received on active duty from all property tax except the minimum tax. Maui taxes the home of a veteran rated 70% or higher at a flat $150 a year, and Kauai exempts veterans rated 80% or higher except for its $150 minimum tax and gives veterans rated below 80% an exemption on up to $50,000 of taxable value.
Up to the amount an E-5 with eight years of service earns for 48 drills and 15 days of annual training, which is $8,636 for tax year 2025. Pay above that amount is taxable in Hawaii.
Two. The Yukio Okutsu State Veterans Home in Hilo has 95 beds, and the Daniel K. Akaka State Veterans Home in Kapolei on Oahu has 120 beds. Both provide skilled nursing and rehabilitation care for eligible veterans.
They get a $46 exemption from the state registration fee on one vehicle, not a full exemption. Request a letter each year from the Office of Veterans’ Services with your driver’s license, current registration and VA 100% letter, then give the original to your county DMV.
In Honolulu, Hawaii County and Kauai, yes: the exemption continues for the veteran’s widow or widower as long as they remain unmarried and keep living in the home. Maui’s rules for surviving spouses should be confirmed with its Real Property Assessment Division.
The State Tuition Assistance Program reimburses up to 100% of tuition at a University of Hawaii community college and up to 50% at a four-year UH campus, subject to funding, for eligible Guard members working toward a degree up to a bachelor’s.
This article is provided by USMilitary.org, an independent educational resource. We are not affiliated with the State of Hawaii, the Hawaii Office of Veterans’ Services, any Hawaii county, VA or any government agency. Benefits and eligibility rules change; confirm current details with the Hawaii Office of Veterans’ Services, your county real property office or the official Hawaii state benefits summary before you apply.