After you retire from the military and start your second career, there is a pretty good chance your employer will offer a 401(k). There is also a decent chance that you could have company stock inside that 401(k). If you do, you'll want to understand NUA.
Non-Qualified Stock Options are a form of equity compensation. If your career after the military involves the tech industry or start-ups, you could end up with this type of compensation. You can make a fair bit of money with them, but you can also end up with an interesting tax scenario as well.
One way employers sweeten the pot for highly-compensated employees is a NQDC. If you're offered one of these after you retire from the military, you're doing all right. But...they're not simple.
AMT isn't as big of an issue as it used to be. But, under circumstances, it can still apply
The military hasn't cornered the market on acronyms. There are plenty of them in the world of executive compensation. ISO is one of them and if you're especially likely to see these if you work for a tech company.
You would think that withholding taxes from your new job after retiring from the military would be a pretty simple thing. It's not. And, if you don't get it right, you could be looking at stroking a check for $6,000 - $7,000 to pay the taxes for your first full year in retirement.
While you're on Active Duty, it is pretty easy to estimate how much your taxes will go up when you get a promotion. It won't be quite that simple after you retire.
When you receive a retro-active VA Disability rating of less than 50%, it's likely your taxable income will be reported incorrectly. As a result of the Strickland Decision, the IRS codified how you could fix that, in IRR 78-161.
One of the really good deals you get on Active Duty is the ability to claim a state without an income tax as your residence (if you were stationed there). That will change when you retire and you may even have to pay income taxes before you retire.
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