I have a question, perhaps it would be better asked on a different thread? Well, here goes... I ETS'd on Dec 4th with 15 yrs 7 mo and 4 days. DFAS withheld taxes from my severance payment, but I didnt get it until mid-Dec, apparently after the cut-off for the W2s because my W2 did not have the severance pay included as income. I have received a VA rating for the same conditions, so as I understand, I should be able to get the taxes back from DFAS? There is currently a case opened because I sent them all the documents required to have the taxes refunded. So I guess my questions are; should I be able to get the taxes back from DFAS? Will I get an amended W2? How long should it take to hear back from my case? I asked the ASK DFAS page and thats how I found out I had an open case. Thank you all so much for this page, it has been a godsend while going through the IDES process.
Severance pay & tax question
- Thread starter stevenrf990205
- Start date
DFAS is not going to be able to help you, you are going to have to file your taxes and OMIT the income from your tax filing as if you never received it.
Since you have crossed over into a new year, the IRS has your money and you have to get it back from them.
There are two ways to go about it, you can file online and you may or may not be contacted in the future by the IRS, or you can file by paper, mail it in and include a copy of the St. Clair decision which is case precedent for the income not being taxable.
The other way to go about it is to do nothing and wait, eventually the IRS will pay everyone back, however I would not hold my breath.
Here is a sample of a St. Clair decision letter for you to prepare.
What if I have already filed my taxes online based on the W2 that I got from DFAS (that didn't have the severance pay on it)?
You are going to need to file an amended return to receive the refund. This may become a challenge and you may have to wait for the corrected W2, then do the calculations.
In the end I think you may be spending a couple of days at the IRS office getting stuff sorted out.
In the end I think you may be spending a couple of days at the IRS office getting stuff sorted out.