While some states charge no taxes on military retirement income, other states consider military retirement as regular income. The Colorado state partially exempts up to $24,000 of retirement income from military retirees regarding the military retirement fund taxable. Moreover, the exemption stays valid for people aged 65 or older.  The state also sets a tax break of $20,000 exemption for people retiring between 55-and 64 years old and $7500 for people under 55.