Yes, Military retirement pay qualifies for Pension and annuity exclusion for Colorado State taxes if you meet the requirements below.
From the Colorado Department of Revenue:
"The rules for the taxability of military retirement benefits are the same as the rules for any retirement pension and annuity income. Persons who were 55 to 64 years of age as of December 31 may exclude up to $20,000 of their military retirement benefits received during the calendar year. Persons who were 65 years of age or older as of December 31, may exclude up to $24,000 of their military retirement benefits received during the calendar year."
