Veterans Benefits
If you are paid certain benefits through the U.S. Department of Veterans Affairs (VA), you can rely on a retirement income that will never be subjected to any taxes.
Although military retirement pay is subject to federal income taxes, military disability retirement pays and certain Veterans’ disability benefits are not included, at least not fully, in the total taxable income.
Conditions to receive tax-free military disability retirement pays in the form of pensions or annuities:
- You were entitled to a disability payment before September 25, 1975
- Your disability payments will be received for combat-related injuries
- You applied for disability compensation from the Department of Veterans Affairs
Veterans’ benefits are also tax-free. Payments for veterans and their families for the following purposes shall not be taxable in any way:
- Disability compensation and payment
- Education and training
- Grants for motor vehicles for veterans who lost their sight or the use of their limbs,
- Veterans’ insurance proceeds and dividends
- Interest on insurance dividends left on deposit with the U.S. Department of Veterans Affairs
All in all, if you’ve served and protected your country, in retirement, it’s time for your country to show its appreciation by offering you a tax-free income.
