Military separation pay and disability payments

[mommyofthree08]

What is the name of your state (only U.S. law)? Texas

My husband planned to re-up for another three years in the Navy despite the medical problems he'd already been dealing with over that last year.
He was told last minute he could not re-inlist. His out date was March 3rd 2008 and he received the first two months of his active duty pay and then 50 percent of his wages for separation pay.

He went on to file a claim with the VA for disability. He received a rating of 90 percent. The first few months of his disability payments went to pay back the separation pay entirely. We do have the letter with his rating and also stating that the first payments would be going to pay back the separation pay.

We received the W2 from the military, or from dfas, and the wages shows the separation pay and the active duty pay from the first two months together. Claiming income we technically didnt receive would put us in the next tax bracket. How do we get this filed correctly?
I've called the VA they say ask a tax professional, I've called DFAS and they say ask a tax professional, so I ask a tax professional and they don't have a clue.

Anyone else know?

 

[LdiJ]

What is the name of your state (only U.S. law)? Texas

My husband planned to re-up for another three years in the Navy despite the medical problems he'd already been dealing with over that last year.
He was told last minute he could not re-inlist. His out date was March 3rd 2008 and he received the first two months of his active duty pay and then 50 percent of his wages for separation pay.

He went on to file a claim with the VA for disability. He received a rating of 90 percent. The first few months of his disability payments went to pay back the separation pay entirely. We do have the letter with his rating and also stating that the first payments would be going to pay back the separation pay.

We received the W2 from the military, or from dfas, and the wages shows the separation pay and the active duty pay from the first two months together. Claiming income we technically didnt receive would put us in the next tax bracket. How do we get this filed correctly?
I've called the VA they say ask a tax professional, I've called DFAS and they say ask a tax professional, so I ask a tax professional and they don't have a clue.

Anyone else know?

How much separation pay are we talking about...in exact dollars?

 

[mommyofthree08]

I went back and checked our bank records, and we received 7,500 for the separation pay. What was paid back as per the disability rating letter was 5,998 as the va took out 25 percent for taxes, but what doesnt make sense now, is that they have that we received 7998.14 which was not the amount as I went back and confirmed by looking at my bank statements, and the amount we received had to of been with taxes taken out, because half of the base pay would have been roughly 11,000 and we did not receive that.