Active-duty service members file state income taxes in their state of legal residence. Military service members are not required to change their legal residence when they move to a new state solely because of military orders; they may maintain their legal residence in a state where they have previously established it.

Does the military withhold state taxes?

Fax to: 1-800-469-6559. DFAS can only withhold income tax for one state at a time, and DFAS cannot withhold state income tax for annuitants.

How much does military get taxed?

In the military, the federal government generally only taxes base pay, and many states waive income taxes. Other military pay—things like housing allowances, combat pay or cost-of-living adjustments—isn’t taxed.

Do you have to pay state income tax if you are in the military?

Some SLR states, like South Carolina, will tax Joe on his income even if he is stationed outside of his Home of Record. For Example: When California is a Home of Record and the active duty military is stationed outside of California, the service member is considered a nonresident of California.

What are tax considerations for active duty military?

Preparing active duty service member tax returns requires advance consideration of specific tax issues. It is common for service members to be in any or more than one of these tax situations at a given time. Understanding these tax situations allows practitioners to better serve military clients and create better tax planning opportunities.

Where do military spouses file their income tax?

Military spouses have the option to file either in his or her resident state or state of duty station. This choice becomes significant for community property valuation.

Can a military member file taxes in Virginia?

The Service member Civil Relief Act states that an active duty member is not considered a resident of a state unless it is his SLR. Joe would only file a Virginia or a Maryland return if he had a civilian (nonmilitary) job in that state.