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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29535
Experience:  Taxes, Immigration, Labor Relations
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Do I have to claim Military Disability on my tax return?

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Do I have to claim Military Disability on my tax return?

LEV :

Hi and welcome to Just Answer!
Please see for reference page 4 in this publication - http://www.irs.gov/pub/irs-pdf/p3.pdf
As we see - Disability pay, including payments received for injuries incurred as a direct result of a terrorist or military action - are excluded from taxable income.
Also - see page 17 here - http://www.irs.gov/pub/irs-pdf/p525.pdf
Certain military and government disability pensions are not taxable.
Service-connected disability. You may be able to exclude from income amounts you receive as a pension, annuity, or similar allowance for personal injury or sickness resulting
from active service in one of the following government services.
-The armed forces of any country.
-The National Oceanic and Atmospheric Administration.
-The Public Health Service.
-The Foreign Service.

LEV :

So - if you receive Military Disability based on your service-connected disability - that payment is not taxable.
But if you receive a disability pension based on years of service, in most cases you must include it in your income.
Let me know if any clarification needed.

LEV :

Please let me know if you need any clarification.

Customer: replied 3 years ago.


Thank you! I now have an acceptable and credible answer... I am now satisfied.Smile

Just in case you were not able to use the chat - I am switching to Q&A mode and porting the answer below.
Please feel free to communicate if you need any clarification or have other tax related issues.


Hi and welcome to Just Answer!
Please see for reference page 4 in this publication - http://www.irs.gov/pub/irs-pdf/p3.pdf
As we see - Disability pay, including payments received for injuries incurred as a direct result of a terrorist or military action - are excluded from taxable income.
Also - see page 17 here - http://www.irs.gov/pub/irs-pdf/p525.pdf
Certain military and government disability pensions are not taxable.
Service-connected disability. You may be able to exclude from income amounts you receive as a pension, annuity, or similar allowance for personal injury or sickness resulting
from active service in one of the following government services.
-The armed forces of any country.
-The National Oceanic and Atmospheric Administration.
-The Public Health Service.
-The Foreign Service.
So - if you receive Military Disability based on your service-connected disability - that payment is not taxable.
But if you receive a disability pension based on years of service, in most cases you must include it in your income.
Let me know if any clarification needed.
Lev and other Tax Specialists are ready to help you