oregon tax retirement income credit - household income does my military retirement income get intered on the veterans and military benifits line

[DaveF1006]

Yes for the Retirement Income Credit you must include all income sources, taxable or not.

Household income generally includes all income (both taxable and nontaxable) each spouse received during the year. Household income includes gross income reduced by adjustments as reported in your federal AGI thus that income should be included in the "Veterans and Military Benefits" section.

[klongie]

I did enter the amount of my Military retirement sum, but "Based on the information provided, you are not eligible for the Retirement Income Credit."  What are the criteria that disallowed this?

[MaryK4]

Household income generally includes most types of income, both taxable and nontaxable, that each spouse receives during the year. This includes such things as veteran’s benefits and disability pay, but it doesn’t include Social Security or Tier 1 Railroad Retirement Board benefits.

@klongie

[bud323]

I have the same question.  What is the reason for disallowing Veterans retirement credit?

[DaveF1006]

Here are the requirements to qualify for the Oregon income Retirement Credit of which Veterans and Military Benefits are a part of. 

• You were age 62 or older on December 31, 2019, and receiving retirement income, and
• Your household income is less than $22,500 ($45,000 if Married Filing Jointly), and
• Your Social Security benefits and/or tier 1 Railroad Retirement Board benefits are less than $7,500 ($15,000 if Married Filing Jointly), and
• Your household income plus your Social Security and/or tier 1 Railroad Retirement Board benefits is less than $22,500 ($45,000 if Married Filing Jointly).

[Lpinn2]

Greetings - I served active duty (AD) from 1/1971 to 2/92 (241 months). None of that AD was served in Oregon. I plan on moving to Oregon but concern w their taxes on such benefits. Does all, part or none of that federal benefit get taxed in Oregon? And Why please? Thank you. 

[SophiaMundis]

Why does my military retirement credit get taxed?

[ReneeM7122]

If you or your spouse got nontaxable pay as a member of the Armed Forces, you don’t have to include it as earned income on your federal taxes.  According to the IRS,  If you and your spouse do choose to include your nontaxable pay as earned income for the EITC, you may owe less tax and get a larger refund. The person who includes your nontaxable pay as earned income must include all of it.

The message you saw is TurboTax trying to help you get the best tax advantage.  Here's what to do:

1. Type in the term earned income credit in the Search tool.
2. Click on the Jump to link in the list.

1. Revisit the Earned Income Credit questions.  Change your answer to No for  "Do you want to include nontaxable combat pay?" 

More information about Excludable Income

You can exclude the following income related to military compensation:

• Basic Pay – All for every month you are present in a combat zone.
• Reenlistment or Continuation Bonuses – You can exclude this income if the reenlistment or the execution of the contractual agreement for continued service occurred while present in a combat zone.
• School Loan Repayments – You can exclude part of the repayment associated with the months you were present in a combat zone. For example, if a year is required to earn the repayment and you serve six of those months in a combat zone, you can exclude half of the repayment income.
• Imminent Danger/Hostile Fire Pay – You can exclude all of this income.
• Leave Benefits – You can exclude income from selling accrued leave earned while in a combat zone.
• Awards and other Financial Incentives – You can exclude associated income for submissions made while in a combat zone.

@SophiaMundis