Certain Payments to Disabled Veterans Ruled Tax-Free; Some May Be Due Refunds

[Wayne Brasch]

The U. S. Tax Court and IRS has managed to generate some more income-producing opportunity for us as tax professionals. It was announced today in IR-2007-198 that "Payments under the Department of Veterans Affairs Compensated Work Therapy (CWT) program are no longer taxable and disabled veterans who paid tax on these benefits in the past three years can now claim refunds, the Internal Revenue Service said today". "Disabled veterans who paid tax on these benefits in tax-years 2004, 2005, and 2006 can claim a refund by filing an amended return using Form 1040X".

Wayne

[jainen]

>>The U. S. Tax Court<<

Most military volunteer shortly after high school, before they have a chance to develop job skills. After their service, the CWT helps them get trained and placed in civilian jobs. It was a national disgrace that we made veterans pay for their own retraining, while only a court ruling could finally get them what they deserve.

[MAMalody]

I think jainen hit it on the head!!

[kcjenkins]

It won't help my income stream, because we do tax returns free for disabled vets. But it is always nice to be able to get them back a little more, when they have given the country so much.