As tax season approaches, many Veterans begin gathering their necessary financial documents and consulting with tax professionals. VA wants Veterans to know they may qualify for special tax breaks and free assistance programs to help them navigate the filing process and maximize their returns.

Whether a Veteran files their taxes independently or uses a tax professional, VA encourages Veterans and their loved ones to review the following tips and resources to both help them navigate the tax season with confidence and to avoid tax season scams.

• Tax benefits as a Veteran: Disability benefits received from VA should not be counted as part of a Veteran’s gross income. Payments from compensation, pension, Veteran Readiness & Employment (VR&E), and education—including the G.I. Bill—are exempt from taxation. Always review the Internal Revenue Service’s webpage on Veterans tax information and services before submitting a tax return.
  • For Veterans who receive disability benefits from VA, refer to Internal Revenue Service (IRS) Publication 525 under “Military and Government Disability Pensions” for more information.
  • Veterans may be eligible to claim a federal tax refund based on an increase in their VA disability percentage (which may include a retroactive determination).
  • Combat-disabled Veterans who are granted Combat-Related Special Compensation after an award for Concurrent Retirement and Disability may be eligible to claim a federal tax refund.
• Free tax assistance programs: Veterans have access to several free tax assistance programs.
  • IRS Free File: If a Veteran’s adjusted gross income is $79,000 or less, they can file electronically with an IRS Free File software provider. If their income is higher, they can use Free File fillable forms.
  • IRS Direct File: If a Veteran lives in a participating state, they can use the free IRS Direct File service to e-file their federal tax return directly with IRS.
  • In-person help: If a Veteran’s adjusted income is $64,000 or less, if they have a disability and/or need language support, or if they are 60-years old or older, they can receive free in-person help from an IRS-certified volunteer.
  • Military OneSource: Use the MilTax software to file federal and state returns for free for up to 365 days after military separation or retirement. For information on other topics, visit MilitaryOneSource.mil or call 800-342-9647.
• Always verify communications: With the increasing sophistication of scams targeting Veterans, it’s important to distinguish between legitimate and fraudulent communications from VA.
  • VA will never send text messages to confirm or request personally identifiable information (PII) for benefits or federal payments.
  • Do not provide personal banking or credit card information to anyone alleging affiliation with VA or other federal entities.
  • Do not share your VA National Call Center (NCC) personal identification number (PIN) with anyone, including family, friends or any entity who makes contact via mobile communication. The VA NCC PIN is a unique identifier which helps protect personal information when communicating with VA.
  • Get an IRS Identify Protection Personal Identification Number (IP PIN). IP PINs are assigned to taxpayers to prevent Social Security Number (SSN) fraud on federal income tax returns. Scammers can use SSNs to commit tax fraud by filing a fraudulent return or claiming a refund; obtaining an IP PIN will keep these scammers from filing a tax return using Veterans’ SSNs.
• Protect your personal information: The tax filing season has increasingly become a prime opportunity for scammers to exploit unsuspecting taxpayers through various communication methods.
  • Refrain from sharing PII, including VA.gov logins, VA NCC personal PINs, dates of birth, military entrance/discharge details, branches of service or SSNs.
  • Limit posting PII online, and don’t share residence addresses, dates of birth, workplace locations or kinship details.
  • Delete old social media accounts, limit online presences and minimize or remove available biographical information.
  • Never send bank information or payments to “online friends” or others. Scammers may threaten to destroy your files or data if you do not send payment or banking information. If you are a victim of ransomware, do not respond to these threats and do report the incident immediately.
  • Protect against identity theft scams. All three credit bureaus (Equifax, Experian and TransUnion) offer Veterans the ability to freeze their credit file for free. A credit freeze allows Veterans to control access to credit reports; requires approvals for applications for credit cards, mortgages or loans; and helps protect against identity theft.

Tax season can be stressful, but Veterans can avoid scams and protect their finances by increasing their knowledge and taking precautions. Understanding Veterans’ tax benefits, choosing a trusted professional or service, recognizing scams and safeguarding PII are all steps to ensure a safe and secure tax filing experience.

If Veterans encounter a tax scam, they should report it to the appropriate authorities. Reporting scams helps protect others from becoming victims and assists in the investigation and prosecution of bad actors. For more information and to report an abusive tax scheme or a tax return preparer, visit Report a tax scam or fraud | Internal Revenue Service (irs.gov).  

If Veterans miss a VA benefits payment, identify a discrepancy in payments or find suspicious activity with their direct deposit account, contact VA immediately at 800-827-1000. Veterans who suspect they are victims of fraud can find resources to file a report to the appropriate agency by visiting www.vsafe.gov or calling 833-38V-SAFE.