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Special Tax Breaks for Members of the U. S. Armed Forces


While most of the deductions and tax breaks with which we are familiar are those that apply to civilian taxpayers, there are also a number of special tax benefits that are only available to members of the military and their families. To find out whether you qualify for these benefits, please contact dedicated Florida tax return preparation lawyer Ronald Cutler today.

Combat Zone Benefits  

There are a number of tax benefits that only apply to service members. For instance, all combat pay is either partially or fully tax free, a benefit that is also often available not only to those who serve in a combat zone, but to those who serve in support of a combat zone, or in a qualified hazardous duty area. Service members who serve in combat zones or in contingency operations outside of the U.S. are also eligible to postpone most tax deadlines and can obtain an automatic extension of the deadline to file their taxes or pay tax debt.

Individuals who served in the Sinai Peninsula now also qualify for combat zone tax benefits retroactive to the summer of 2015, including members of the Army, Navy, Marines, Air Force, and Coast Guard who performed services in this area. Additionally, citizens or resident aliens who work as contractors, or for contractors that support the U.S. military in designated combat zones, may also be eligible for the foreign earned income exclusion.

Other Tax Benefits  

The Earned Income Tax Credit (EITC) is a benefit that is available to low income individuals and works to reduce the amount of tax liability that a person owes. In most cases, the EITC is worth up to $6,431. However, service members who have a low or moderate income and who receive nontaxable combat pay can use a special computation method when calculating the EITC, which means that they could end up owing less in tax or collecting a larger refund.

There are, however, a few deductions that are no longer available to service members. For instance, only certain Armed Forces members can now take advantage of the moving expenses deduction. Fortunately, active duty members of the military who are required to relocate due to a permanent change of station are still eligible for the deduction. Further, allowances that are paid to help members of the Armed Forces relocate can be excluded when calculating taxable income if provided to support a permanent change of station.

When it comes to calculating income, military personnel can also exclude dependent care assistance program benefits. Furthermore, while both spouses are usually required to sign a joint income tax return, military spouses could be eligible to sign on their partner’s behalf if he or she is absent due to the fulfillment of military duties or conditions.

Call Today for a Free One-on-One Consultation

If you have questions about whether you qualify for military tax benefits, please call 386-490-9949 to schedule a free case evaluation with dedicated Florida tax return preparation lawyer Ronald Cutler, P.A. today.