According to the Nebraska Department of Revenue, military members have two options for excluding their military retirement on their tax return.
- Option 1- Exclude 40% of the military retirement benefit for seven consecutive taxable years beginning in the year the election is made
- Option 2- Exclude 15% of the military retirement benefit for all taxable years beginning when the military member turns age 67
Once the election is made, it is irrevocable. To make your election, complete form 1040N-MIL within two years of your retirement date. Mail the form separately from your tax return.
To make the entry into the program, go to the
- State Section
- Subtractions From Income
- Military Retirement