Military Benefits received while under age 55 Colorado

[bmg3arhart]

Military Benefits received while under age 55 Colorado

Does this include VA disability paid every month for the year 2019?

[DMarkM1 · Accepted solution]

No.  Veterans disabilty is non-taxable and should not show up on your returns anywhere. 

This question is referring to military retirement pay as veterans ages 55 to 64 can exclude $20,000 of retirement pay from state taxes and those over 64 can exclude $24,000.  That of course means those under 55 are not excludable.  

[Anonymous]

UPDATE: Colorado House Bill 18-1060 (signed24 May 2018) changes the law allowing a special deduction from military retirement income FOR AN INDIVIDUAL WHO IS UNDER FIFTY-FIVE YEARS OF AGE:

39-22-104. Income tax imposed on individuals, estates, and trusts - single rate - legislative declaration - definitions - repeal. (4) There shall be subtracted from federal taxable income:

(y) (I) FOR INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 2019, BUT PRIOR TO JANUARY 1, 2024, AN AMOUNT EQUAL TO A QUALIFIED INDIVIDUAL'S MILITARY RETIREMENT BENEFITS INCLUDED IN FEDERAL ADJUSTED GROSS INCOME, BUT NOT TO EXCEED THE FOLLOWING AMOUNTS:

(A) FOUR THOUSAND FIVE HUNDRED DOLLARS FOR INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 2019, BUT PRIOR TO JANUARY 1, 2020;

Colorado Turbotax users in this situation should enter their maximum of the amount received up to the maximum 4500 in the block when asked; do not enter “Military Retirement Income” from the 1099-R; ex. if your 1099-R block 1 shows 43000, you will enter 4500. 

Refer to the CO law .gov website for the signed law.