Tax Breaks for the Military

If you are in the U. S. Armed Forces, there are special tax breaks for you. For example, some types of pay are not taxable. Certain rules apply to deductions or credits that you may be able to claim that can lower your tax. In some cases, you may get more time to file your tax return. You may also get more time to pay your income tax. Here are some tips to keep in mind:

Deadline Extensions.  Some members of the military, such as those who serve in a combat zone, can postpone some tax deadlines.
Combat Pay Exclusion.  If you serve in a combat zone, your combat pay is partially or fully tax-free.
Moving Expense Deduction.  You may be able to deduct some of your unreimbursed moving costs on Form 3903.
Earned Income Tax Credit or EITC.  If you get nontaxable combat pay, you may choose to include it in your taxable income. Including it may boost your EITC, meaning you may owe less tax and could get a larger refund.
Signing Joint Returns.  Both spouses normally must sign a joint income tax return. If your spouse is absent due to certain military duty or conditions, you may be able to sign for your spouse.
Reservists’ Travel Deduction.  Reservists whose reserve-related duties take them more than 100 miles away from home can deduct their unreimbursed travel expenses on Form 2106, even if they do not itemize their deductions.
Uniform Deduction.  You can deduct the costs of certain uniforms that you can’t wear while off duty.
ROTC Allowances.  Some amounts paid to ROTC students in advanced training are not taxable.
Civilian Life.  If you leave the military and look for work, you may be able to deduct some job search expenses.
Tax Help.  Most military bases offer free tax preparation and filing assistance during the tax filing season.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999