According to the North Carolina Department of Revenue website, military retirement pay may not be taxed at all if it meets certain requirements including if the veteran was “vested in the retirement system” for five years as of August 12, 1989.
If your retirement is excludable under the Bailey Settlement, please go to:
- State Section
- Edit North Carolina Return
- Subtractions From Income
- Enter the amount of taxable retirement benefits that qualify for the Bailey Settlement included on federal return.