Yes, you may use military retirement as a subtraction if you are a Medal of Honor recipient. Please see details below.
Military retirement income received by individuals awarded the Medal of Honor can be subtracted from federal gross income. The amount of the subtraction is the amount of military retirement benefits reported in federal adjusted gross income. The subtraction does not apply to benefits received by a surviving spouse.
Code of Virginia Section 58.1-322 [C] [26]
