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Veterans and Taxes: More Than 133,000 Injured Veterans Eligible For Over $78 Million In Tax Refunds

veterans and taxes

When it comes to veterans and taxes, I keep my readers informed when any new laws affecting veterans are enacted.

The Combat-Injured Veterans Tax Fairness Act passed in 2016. This law entitles more than 133,000 injured veterans to tax refunds as far back as 1991. The law seeks to protect veterans who suffer service-ending combat-related injuries. It helps ensure they aren’t taxed on the severance payment from the DoD.

The DOD is just beginning to send letters to the eligible veterans. This information explains how to claim tax refunds. According to an article posted on accountingtoday.com, “The letters will provide an explanation of a simplified method for claiming the refund.”

In addition, the article states that, “The amount of time for claiming the tax refunds is limited, though the law gives veterans an alternative timeframe, one year from the date of the letter from DoD. Veterans who make the claims have the normal limitations period for claiming a tax refund, or they can claim it one year from the date of their letter from the DoD, whichever expires later.”

There are a couple of ways you can claim the refund.

You can either send in a claim based on the actual amount of the disability severance payment received by filling out Form 1040X. You must carefully follow the instructions. Or you can opt for a simplified method which is the easiest way. You simply choose to claim a standard refund amount based on the calendar year in which you received the severance payment. Then, write “Disability Severance Payment” on line 15 of Form 1040X and enter on lines 15 and 22 the standard refund amount listed below that applies:

• $1,750 for tax years 1991 – 2005
• $2,400 for tax years 2006 – 2010
• $3,200 for tax years 2011 – 2016

For more information talk with your tax attorney or visit:
https://www.irs.gov/newsroom/veterans-owed-refunds-for-overpayments-attributable-to-disability-severance-payments-should-file-amended-returns-to-claim-tax-refunds

   

Looking to find an experienced estate lawyer in the Georgia area who is skilled in asset protection and estate plan preparation? Shannon Pawley is an attorney in Georgia with expertise in estate planning and asset protection. Shannon can provide assistance with creating an estate plan to include making a will and how to establish a trust properly. If you have questions about asset protection or questions about making an estate plan, reach out to Shannon and she will be glad to help answer all the estate planning questions you might have!

 
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