If you are in the military, you already have a lot of important things to worry about and keep track of. You don’t need to go through the year and realize that you haven’t taken full advantage of opportunities that the government has given you. Especially when it comes to taxes.
Yes I know, it isn’t “tax season”. But there are many things that you can do right now to reduce your tax bill (or increase your refund) next year – especially if you serve in the Armed Forces.
That’s why the IRS has released these 10 tips for people who are in the military and their families. Hopefully these will be a benefit to you.
If you know someone who serves in our military, please forward this article to them!
Here are the 10 tips:
Moving Expenses – If you are a member of the Armed Forces on active duty and you need to hire moving companies and move because of a permanent change of station, you can deduct the reasonable unreimbursed expenses of moving you and members of your household.
Combat Pay – If you serve in a combat zone as an enlisted person or as a warrant officer for any part of a month, all your military pay received for military service that month is not taxable. For officers, the monthly exclusion is capped at the highest enlisted pay, plus any hostile fire or imminent danger pay received.
Extension of Deadlines – The time for taking care of certain tax matters can be postponed. The deadline for filing tax returns, paying taxes, filing claims for refund, and taking other actions with the IRS is automatically extended for qualifying members of the military.
Uniform Cost and Upkeep – If military regulations prohibit you from wearing certain uniforms when off duty, you can deduct the cost and upkeep of those uniforms, but you must reduce your expenses by any allowance or reimbursement you receive.
Joint Returns – Generally, joint returns must be signed by both spouses. However, when one spouse may not be available due to military duty, a power of attorney may be used to file a joint return.
Travel to Reserve Duty – If you are a member of the US Armed Forces Reserves, you can deduct unreimbursed travel expenses for traveling more than 100 miles away from home to perform your reserve duties.
ROTC Students – Subsistence allowances paid to ROTC students participating in advanced training are not taxable. However, active duty pay – such as pay received during summer advanced camp – is taxable.
Transitioning Back to Civilian Life – You may be able to deduct some costs you incur while looking for a new job. Expenses may include travel, resume preparation fees, and outplacement agency fees. Moving expenses may be deductible if your move is closely related to the start of work at a new job location, and you meet certain tests.
Tax Help – Most military installations offer free tax filing and preparation assistance during the filing season.
Tax Information – IRS Publication 3, Armed Forces’ Tax Guide (opens PDF), summarizes many important military-related tax topics.
To learn more about tax deductible job expenses, read this article: http://knsfinancial.com/looking-for-a-job-the-irs-wants-to-help/
To find out more about tax credits, deductions, and tax planning, visit the KNS Financial Tax Center: http://knsfinancial.com/taxes/
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