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Congress Shocked by Number of Disabled Vets Due Refunds

Nineteen months ago, as Congress considered the Combat-Injured Veterans Tax Fairness Act of 2016, lawmakers shepherding the bill (HR 5015) toward enactment advised that perhaps 13,800 veterans had had taxes mistakenly withheld from lump-sum disability separation payments and would get refunds. The average amount of taxes withheld was estimated at $5,500, proponents said, and the total cost to the U. S. Treasury would be less than $78 million. My, my, were those projections off the mark. [more]

Released 7/19/18 | Tags: Congressional Legislation

Boozman, Warner Encourage Certain Combat-Injured Veterans to File with IRS to Recover Money

The Internal Revenue Service (IRS) is advising veterans who have been separated from service for combat-related injuries and received a severance payment that was improperly taxed to take advantage of the relief offered to them by the Combat-Injured Veterans Tax Fairness Act (P.L. 114-292), a law based off a bill authored by U.S. Senators John Boozman (R-AR) and Mark Warner (D-VA). Under federal law, veterans who suffer combat-related injuries and who are separated from the military are not supposed to be taxed on the one-time lump sum disability severance payment they receive from the Department of Defense (DoD). However, for years DoD improperly withheld taxes on these payments from thousands of qualifying veterans, who were typically unaware that their benefits were being improperly reduced. The Combat-Injured Veterans Tax Fairness Act rights that wrong, but affected veterans only have a short window in which to seek restoration. The IRS is advising qualifying veterans to file Form 1040X, Amended U.S. Individual Income Tax Return, to claim a credit or refund of the overpayment attributable to the disability severance payment. [more]

Released 7/17/18 | Tags: Congressional Legislation

Tips to Help Combat-Injured Veterans Obtain Tax Refunds

More than 130,000 combat-injured veterans had their lump sum severance pay improperly taxed by the government due to a computer glitch when they left the military from 1991-2016. On July 9, 2018, the Department of Defense began mailing letters to notify affected veterans, and on July 11, 2018, the Internal Revenue Service (IRS) issued guidance to assist veterans. [more]

Released 7/17/18 | Tags: Congressional Legislation

US Asks To Appeal Ruling It Misspent $200M In PACER Fees

The federal government has urged a District of Columbia federal court to greenlight an appeal of a decision finding that the government misused $200 million in fees for users of its Public Access to Electronic Court Records system, saying the damages calculations would likely be so time-consuming that it would be more efficient to appeal the users' win now. [more]

Released 7/16/18 | Tags: Class Actions

Pentagon sending letters to more than 130,000 owed tax refund on disability pay

The Defense Department has identified more than 130,000 veterans released from military service following injuries who may be owed more than $1,700 each in tax refunds after the Pentagon incorrectly withheld money from their disability pay, officials said Monday. Letters were sent this month by the IRS notifying 130,062 veterans that the federal agency might have improperly collected taxes on their lump sum disability severance pay issued between 1991 and 2016, said Army Lt. Col. David Dulaney, the executive director of the Armed Forces Tax Council. Veterans who were sent the letter, which should arrive in the coming weeks, will have one year from the letter’s date to file their amended tax refund claim. [more]

Released 7/16/18 | Tags: Congressional Legislation

Some veterans can get new tax refund

The federal government is urging some 133,000 veterans who had money improperly withheld from their severance payments for combat-related injuries or other disability compensation to apply for tax refunds. In some cases the improper withholding dates as far back as 1991. The Department of Defense (DOD) is sending letters to the eligible veterans this month, stating the amount of the disability payment and telling them what to do to receive a refund. Survivors of veterans who would have been eligible for this refund may also app [more]

Released 7/16/18 | Tags: Congressional Legislation

IRS owes tax refunds to 133,000 injured veterans

The Internal Revenue Service is preparing to send millions of dollars in tax refunds to veterans who received disability severance payments starting in 1991.The tax refunds are the result of a 2016 law known as the Combat-Injured Veterans Tax Fairness Act (see Combat-injured veterans receiving special tax refund). More than 133,000 injured vets may qualify for the tax refunds, according to the National Veterans Legal Services Program, originally estimated to amount to $78 million but now thought to be much more than that sum. The tax refunds are expected to average $1,750 or more, according to CBS News. [more]

Released 7/13/18 | Tags: Congressional Legislation

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