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Level 1

How do I account for the 40% disabled portion of my military retirement that is not separated on my 1099R?

My military retirement 1099R does not account for 40% disability that is paid as a subset of that and is supposed to be tax free.  it would reduce my taxable income by over $8000.

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Level 1

How do I account for the 40% disabled portion of my military retirement that is not separated on my 1099R?

 VA Disability compensation is not part of your military retired pay, so it is not reported on your DFAS Form 1099-R and is not  reported anywhere on your tax return. Since the VA compensation never shows up on your tax return, it doesn't need to be taken off your tax return.

Since VA Disability compensation is not taxable, you just get a direct deposit every month - no tax documents are issued, just an annual  VA Award Letter every December (or January).