It is a deduction for military retirement.
In November 2021, North Carolina enacted legislation that allows eligible retired members of the Armed Forces of the United States (“Armed Forces”) to deduct certain military retirement pay when calculating North Carolina taxable income beginning tax year 2021.
The law also allows eligible beneficiaries of the Survivor Benefit Plan (“SBP”) to deduct certain SBP payments beginning tax year 2021.
You can deduct your retirement if you meet the qualifications of 20 years of service or are medically retired or the spouse of a qualifying retiree.
Learn more at Important Notice: North Carolina Enacts New Deduction For Certain Military Retirement Pay and Survivor Benefit Plan Payments
That part I understand. Is the amount I enter the money received during the year from the military pension? For example, if $5000 was received is that the amount I put?
Yes, that is correct, you enter the amount for pensions so it can be deducted. @mlapanne
My husband is medically retired from US Army and we moved to NC in June. For the benefit deduction, how do we calculate the amount? The total disability payments received from June 1- 12/31?
Yes, first you will allocate to NC in the income section the pension income amount received from 1 Jun - 31 Dec (7 months) (since it is typically received at the end of the month). Later in the interview you will then be able to exclude that amount from NC taxation as military retirement.