Veteran disability severance payment deadline - Spidell

Veteran disability severance payment deadline


The IRS is reminding veterans about an approaching deadline for claiming a refund for veteran disability severance payments. (IR-2019-125)

In July 2018, the Department of Defense (DOD) and the IRS sent letters to certain veterans who received one-time lump-sum disability severance payments after January 17, 1991, informing them that they have additional time to file tax refunds for wrongfully withheld taxes on these payments. Estates or surviving spouses can also file a claim on behalf of a veteran who is now deceased.

Veterans may claim a refund by the later of:

  • One year from the date of the DOD letter (so, July 2019);
  • Three years after the due date for filing the original return for the year the disability severance payment was made; or
  • Two years after tax was paid for the year the disability severance payment was made.

Veterans who did not receive the DOD letter and who do not have the required documentation can get more information at:

www.dfas.mil/dsp_irs.html

See the IRS’s FAQs for more information:

www.irs.gov/individuals/military/filing-amended-returns-for-combat-injured-disabled-veterans