Disability retirement pay you receive as a pension, annuity or similar allowance for an injury or sickness that resulted from active service is not included in your taxable income. The same treatment covers VA disability compensation and pension payments to you or your family, grants for a home designed for wheelchair living, grants for a vehicle if you lost your sight or the use of a limb, and benefits under a dependent care assistance program.
There is nothing to apply for. Leave these payments out of the income you report on your North Carolina return.
Your VA award letter or retirement orders showing what the payments are for.
