- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Deductions & credits
Note that you will have to print, sign and mail your return. You do the math to adjust your 1099-R only if the VA award is retroactive, and the 1099-R includes pay that would have excluded from tax. In your mailing you will need to include a copy of the paperwork from the VA awarding you the benefit retroactive, and the effective date of the tax exempt benefit must be clearly stated in that paperwork. Usually, it's in the actual award letter. While 525 may state it can be "e-filed or mailed", efiling is not an option for you in this case. The IRS want's (requires?) original signatures. So you have to mail it.
Make sure you select the "print and mail" option in turbotax, as the instruction sheet that will print will include the address where you mail the return, along with a list of other documents you will need to include in your mailing. (such as the 1099-R). In addition to the documents listed, also include your VA paperwork awarding you the benefit.
From IRS publication 525:
To do so, the disabled veteran will need to file the amended return, Form 1040-X, Amended U.S. Individual Income Tax Return, to correct a previously filed Form 1040, 1040-A or 1040-EZ. An amended return can be e-filed or filed by paper for most returns. For tax years 2019 and later, a paper filed original return can be amended electronically or by paper. Disabled veterans should include all documents from the Department of Veterans Affairs and any information received from Defense Finance and Accounting Services explaining proper tax treatment for the current year.
Please note: It is only in the year of the Department of Veterans Affairs reassessment of disability percentage (including any impacted retroactive year) or the year that the CRSC is initially granted or adjusted that the veteran may need to file amended returns.