I am an Army retiree with 100% service connected disability.
I am receiving Army retirement pay as well as VA compensation amounting $3517.84 per month. My question is with regard to my military retirement pay. My Army retirement pay has been taxed by both Federal and State income taxes. It was my understanding that any service connected disability would entitle income tax exemption from both federal and state. Do I understand the tax law incorectly? Please straighten me out.
Thank you
