Military Zone

Thank you for your service!
Free Tax Preparation Options for Servicemembers
Department of Defense's MilTax Service
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Managed by the Department of Defense, MilTax provides FREE tax preparation and filing software for all military servicemembers, regardless of income. Eligible individuals include members of the Air Force, Army, Navy, Marines and National Guard. Coast Guard members serving under Title 10 authority are entitled to the services as well. Retired and honorably discharged members are eligible for up to 180 days past their separation date. Access MilTax using the following link:
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For Coast Guard members not serving under Title 10, CG SUPRT offers a service similar to MilTax. To learn more, visit the Coast Guard's information page using the following link:
Volunteer Income Tax Assistance Program (VITA)
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Military members, including retirees, are eligible to receive free tax consultation and preparation through VITA locations. VITA specialists are trained to address military-specific tax issues like combat-zone benefits and applying Earned Income Credit guidelines. Find your nearest VITA site using the following link:
Free File Program
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Servicemembers who made $72,000 or less in 2020 qualify for free online tax preparation services through the IRS Free File program. The program is made possible through a public-private partnership between the IRS and the Free File Alliance---a coalition of leading tax preparation software companies. Active duty servicemembers and their spouses who meet the income limitation may choose from nine of the ten Free File companies without regard to additional eligibility requirements. Use the IRS's Free File Lookup Tool to quickly find a qualifying Free File company based on your specific situation:
Military: Frequently Asked Tax Questions
General
Recordkeeping: What records do I need to keep for tax preparation purposes and how do I need to keep them?
According to the IRS, you must keep records such as receipts, canceled checks, and other documents (W-2s, 1099s, invoices, etc.) that support either an item of income, a deduction, or a credit appearing on a tax return for as long as those records may become material in the administration of any provision of the Internal Revenue Code. In short, you are required to keep all records that support anything reflected on your tax return for at least 3 years. Taxpayers should also remember to keep copies of their previously filed tax returns, including any amended returns, to assist in preparing future returns.
Change of Address (PCS): My mailing address changed, do I need to notify the IRS?
Yes.
Military Pay: What types of military pay do I need to include as income on my tax return?
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Active duty -
Attendance at a designated service school -
Back wages -
Cadet/midshipman pay -
Drills -
Reserve training -
Training duty
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Aviation career incentives -
Career sea -
Diving duty -
Foreign duty (outside the 48 contiguous states and the District of Columbia) -
Foreign language proficiency -
Hardship duty -
Hostile fire or imminent danger -
Medical and dental officers -
Nuclear-qualified officers -
Optometry -
Other Health Professional Special Pays (for example, nurse, physician assistant, social work, etc.) -
Pharmacy -
Special compensation for assistance with activities of daily living (SCAADL) -
Special duty assignment pay -
Veterinarian -
Voluntary Separation Incentive
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Career status -
Continuation pay -
Enlistment -
Officer -
Overseas extension -
Reenlistment
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Submarine -
Flight -
Hazardous duty -
High Altitude/Low Opening (HALO)
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Accrued leave -
CONUS COLA -
High deployment per diem -
Personal money allowances paid to high-ranking officers -
Student loan repayment from programs such as the Department of Defense Educational Loan Repayment Program when year's service (requirement) is not attributable to a combat zone
Non-Taxable Income: What types of military pay can I exclude from income?
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Certain amounts received under the Armed Forces Health Professions Scholarship and Financial Assistance Program payments -
Certain disability retirement pay, including payments received for injuries incurred as a direct result of a terrorist or military action -
Disability severance payments (See Disability Severance Payments to Veterans , later) -
Group-term life insurance -
Professional education -
ROTC educational and subsistence allowances -
State bonus pay for service in a combat zone (See State bonus payments , later) -
Survivor and retirement protection plan premiums -
Uniform allowances
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Burial services -
Death gratuity payments to eligible survivors -
Travel of dependents to burial site
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Certain educational expenses for dependents -
Emergencies -
Evacuation to a place of safety -
Separation
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BAH (Basic Allowance for Housing) (See also Can I deduct expenses paid with my excluded basic allowance for housing (BAH) , later) -
BAS (Basic Allowance for Subsistence) -
Housing and cost-of-living allowances abroad paid by the U.S. Government or by a foreign government -
OHA (Overseas Housing Allowance)
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Dislocation -
Military base realignment and closure benefit (See Military base realignment and closure benefits , later) -
Move-in housing -
Moving household and personal items -
Moving trailers or mobile homes -
Storage -
Temporary lodging and temporary lodging expenses
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Annual round trip for dependent students -
Leave between consecutive overseas tours -
Reassignment in a dependent restricted status -
Transportation for you or your dependents during ship overhaul or inactivation -
Per diem
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Dependent-care assistance program -
Defense counsel services -
Legal assistance -
Medical/dental care -
Commissary/exchange discounts -
Space-available travel on government aircraft -
Uniforms furnished to enlisted personnel
Tax Residence: Can I claim my spouse's state of residence on my tax return if he or she resides in a different location than I do?
Yes. Beginning in 2018, if you are the civilian spouse of an active duty servicemember, you may elect to have the same tax residence as the servicemember.
TSP Withdrawals: Do I need to pay taxes on the money I withdrew from my Thift Savings Plan (TSP)?
Disability Severance Pay: Do I need to pay taxes on my disability severance pay?
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The veteran has a combat related injury or illness as determined by the veteran's military service at separation that: -
Resulted directly from armed conflict; or -
Took place while the veteran was engaged in extra-hazardous service; or -
Took place under conditions simulating war, including training exercises such as maneuvers; or -
Was caused by an instrumentality of war.
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The veteran is receiving VA disability compensation or has received notification from the VA approving such compensation.
Funds Received for PCS: Do I need to report the reimbursement funds I received for moving?
Mistakes: What should I do if I made a mistake on my federal income tax return that I already filed?
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If you did not claim the correct filing status or you need to change your income, deductions, or credits, you should file an amended or corrected return using Form 1040X (Amended U.S. Individual Income Tax Return).
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Include copies of any forms and/or schedules that you're changing or didn't include with your original return. -
To avoid delays, file Form 1040X only after you've filed your original return. Generally, for a credit or refund, you must file Form 1040X within 3 years after the date you timely filed your original return or within 2 years after the date you paid the tax, whichever is later. -
Allow the IRS up to 16 weeks to process the amended return.
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IRS Tax Topic 308 (Amended Returns) -
Should I File an Amended Return? -
Instructions for Form 1040-X (Amended U.S. Individual Income Tax Return)
Reservists
Reservists Defined: Who is considered a member of a Reserve Component for tax purposes?
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Army, Navy, Marine Corps, Air Force, or Coast Guard Reserve; -
Army National Guard of the United States; -
Air National Guard of the United States; or -
Ready Reserve Corps of the Public Health Service.
Travel Expenses: As a reservist, can I deduct my travel expenses connected with attending training or drill?
IRS Distributions: As a reservist, are distributions from my Indiviudal Retirement Account (IRA) subject to the 10% early withdrawal penalty?
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You were ordered or called to active duty after September 11, 2001; -
You were ordered or called to active duty for a period of more than 179 days or for an indefinite period because you are a member of a reserve component; -
The distribution is from an IRA or from amounts attributable to elective deferrals under a section 401(k) or 403(b) plan or a similar arrangement; and -
The distribution was made no earlier than the date of the order or call to active duty and no later than the close of the active duty period.
Deployment Issues
Extensions for Overseas Deployment: If I am serving overseas, do I have more time to file and pay my taxes?
Yes. Members of the U.S. Armed Services deployed overseas are entitled to an automatic two-month extension (i.e., until June 15th) to file and pay their federal income taxes. You are not required to file any paperwork to receive the extension. Servicemembers deployed to a combat zone are entitled to much longer extension (see below).
Deployment Pay: Is military pay I receive while depolyed to a combat zone subject to federal income tax?
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Active duty pay earned in any month you served in a combat zone. -
Imminent danger/hostile fire pay. -
A reenlistment bonus if the voluntary extension or reenlistment occurs in a month you served in a combat zone. -
Pay for accrued leave earned in any month you served in a combat zone. The DoD must determine that the unused leave was earned during that period. -
Pay received for duties as a member of the Armed Forces in clubs, messes, post and station theaters, and other nonappropriated fund activities. The pay must be earned in a month you served in a combat zone. -
Awards for suggestions, inventions, or scientific achievements you are entitled to because of a submission you made in a month you served in a combat zone. -
Student loan repayments. If the entire year of service required to earn the repayment was performed in a combat zone, the entire repayment made because of that year of service is excluded. If only part of that year of service was performed in a combat zone, only part of the repayment qualifies for exclusion. For example, if you served in a combat zone for 5 months, 5/12 of your repayment qualifies for exclusion.