We encouraged members of the military and their families to learn more about the special tax benefits available to them as the April 15 tax filing season deadline approaches.
Combat pay is partially or fully tax-free. Service members serving in support of a combat zone or in a qualified hazardous duty area may also qualify for this exclusion. In addition, U.S. citizens or resident aliens, such as spouses, that worked as contractors or employees of contractors supporting the U.S. Armed Forces in designated combat zones, may now qualify for the foreign earned income exclusion.
Members of the military, such as those who serve in a combat zone or are serving in contingency operations outside the United States, can postpone most tax deadlines. Those who qualify can get automatic extensions of time to file and pay their taxes.
The Earned Income Tax Credit is worth up to $6,431. Low- and moderate-income service members who receive nontaxable combat pay can use a special computation method that may boost the EITC, meaning they may owe less tax or get a larger refund.
Those who served in the Sinai Peninsula of Egypt may qualify for combat zone tax benefits retroactive to June 2015. Under the Tax Cuts and Jobs Act (TCJA) members of the U.S. Army, U.S. Navy, U.S. Marines, U.S. Air Force, and U.S. Coast Guard who performed services in the Sinai Peninsula can now claim combat zone tax benefits.
Dependent care assistance programs for military personnel are excludable benefits and not included in the military member’s income.
The moving expenses deduction is suspended, except for certain Armed Forces members. Beginning in 2018, active duty members of the U.S. Armed Forces who must move because of a military order to a permanent change of station can still claim this deduction. Also, allowances paid to move members of the U.S. Armed Forces for a permanent change of station are excluded from tax.
Both spouses normally must sign a joint income tax return, but if one spouse is absent due to certain military duty or conditions, the other spouse may be able to sign for him or her. A power of attorney is required in other instances. A military installation’s legal office may be able to help.
Account On Us offers many services for individuals such as income tax preparation, estate tax preparation, gift tax preparation, IRS inquiries, audits and tax planning. If you have a personal tax or accounting need, please contact Osceola County’s most trusted accounting service, tax preparation and payroll service provider. Call us today at (407) 892-1066 or contact Account On Us today! We are here to help!