Did you indicate you qualify in the VA state return? When you go through the state interview, you will come to a screen titled Here's the income that Virginia handles differently. The second line item is Military Benefits Subtraction. Click Start there and answer the questions to subtract the income from your VA return.
Individuals who receive qualifying military benefits are eligible for the Military Benefits Subtraction. There is no longer an age requirement for this subtraction. The maximum subtraction for 2024 is $30K

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