Random: Is military pay taxed?
- Thread starter SosaUK1987
- Start date
their pay is taxed federally. State tax is not determined by where you are stationed. Each solider has a state he has declared and he is taxed by that state's rate regardless of what state he is living in. For example, I was a TX resident and never paid state tax wherever I was stationed.
Yes, my pay was taxed when I served in the Air Force such as Social Security & Medicare taken out. State taxes are based on your home of record which was Tennessee for me at the time. If you are stationed for example at Travis Air Force Base in California but your home of record is in another state, you still pay home of record state's taxes. Even if you have an apartment in CA or live in base housing. Active Duty military pay is exempt in Kentucky & TN. Not exempt from federal taxes. There are combat zone tax exclusions if you are deployed. If you re-enlist in a combat zone, SRB selective re-enlistment bonus, then any bonuses you may get would be tax free if you meet the criteria.
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I'm assuming that changed after I got out of the Air Force in 95. I always had Kentucky as my home state and am pretty sure I paid KY state tax on my income my 4 years in. It's been nearly 30 years and my memory isn't as good as it once was so I could be remembering wrong. I do remember guys that were from Florida or had been stationed there and made it their home state that had no state tax coming out of their checks.
Awesome info guys. Answered my question perfectly. Thank you and thank you for your service.
I've been out for 10 years, but when I was in it worked like this.
Base pay was taxed for federal income tax and the state income tax on the state of my residence. You could declare residence for any state you lived in. So, when people would get stationed in Texas or Florida, they would usually become residents because there was no state income tax there. I was a Tennessee resident when I was commissioned, so I never paid state income tax.
Allowances for housing and food were not taxed at all. That made up probably 30-40% of my compensation. Hazardous duty pay was not taxed either.
When I was deployed, I don't think any of my income (including base pay) was taxed at all.
Base pay was taxed for federal income tax and the state income tax on the state of my residence. You could declare residence for any state you lived in. So, when people would get stationed in Texas or Florida, they would usually become residents because there was no state income tax there. I was a Tennessee resident when I was commissioned, so I never paid state income tax.
Allowances for housing and food were not taxed at all. That made up probably 30-40% of my compensation. Hazardous duty pay was not taxed either.
When I was deployed, I don't think any of my income (including base pay) was taxed at all.