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Congressman King informs veterans about tax-free payments and possible refunds Congressman Peter King (R-Seaford) has recently been informed by the Internal Revenue Service (IRS) that payments under the Department of Veterans Affairs (VA) Compensated Work Therapy (CWT) program are no longer taxable and disabled veterans who paid tax on these benefits in the past three years can now claim refunds. "Recipients of CWT payments will no longer receive a Form 1099 from the Department of Veterans Affairs," Congressman King said. "Disabled veterans who paid tax on these benefits in tax-years 2004, 2005 or 2006 can claim a refund by filing an amended return using IRS Form 1040X." King noted that the IRS agreed with a U.S. Tax Court decision issued earlier this year, which held that CWT payments are tax-free veterans' benefits. In doing so, the IRS reversed a 1965 ruling which held that these payments were taxable and required the VA to issue 1099 forms to payment recipients. "The CWT program provides assistance to veterans unable to work and support themselves," Congressman King said.
For additional information or to download IRS Form 1040X, please visit the IRS website www.irs.gov or call 1-800-829-1040; 1-800-829-4059 (TDD) for the hearing impaired.
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