The Defense Department (DoD) will begin notifying more than 133,000 combat-injured veterans who may qualify for a federal tax refund based on their disability severance. DoD will begin the process of refunding thousands of veterans who have been taxed on this pay since 1991, thanks to efforts by Senators John Boozman (Ariz.), Mark Warner (Va.), and Congressman David Rouser (N.C.). Under federal law, veterans who suffer combat-related injuries and are separated from the military are not supposed to be taxed on the one-time, lump sum DoD disability severance payment. Unfortunately, taxes on these payments have been withheld from qualifying veterans for a number of years due to the limitations of the DoD’s automated payment system. More than 133,000 veterans may qualify for a refund. Veteran’s organizations supported the “Combat-Injured Veterans Tax Fairness Act” (sponsored by the legislators listed above) that was enacted into law (H.R.5015, P.L. 114-292) in 2016. In order to correct the problem, the law is being implemented and directs the DoD to identify veterans who have been separated from service for combat-related injuries, received payment and were improperly taxed. The law requires the DoD determine how much the veterans are owed and notify them so they can recover the withheld amounts. For more information, contact Sandra at the Veterans Service Office at 602 Strong Ave on Tuesdays and Thursdays from 10am to 3pm, or call 365-3612.
Veteran’s Corner 3-28-18
