Yes, military retirement income is non-qualified. Qualified retirement plans qualify for certain tax benefits and meet the guidelines of the Employee Retirement Income Security Act (ERISA) while nonqualified plans don't. Examples of qualified plans are 401(k) plans, profit-sharing plans, and Keogh (HR-10) plans. Examples of nonqualified plans are deferred-compensation plans, executive bonus plans, and split-dollar life insurance plans.
Refer to the TurboTax article What is a "qualified retirement plan"? for more information.
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