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Military Tax Issues Department of Revenue Kentucky Gov 2022

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Instructions and help about return schedule 01

If you’re in the Armed Forces, there are  several special tax benefits that apply to you. First, you may be eligible  for a combat zone exclusion…   which means some or all of your  combat pay could be tax free. However. . . you may choose instead to include  tax-free combat pay in your earned income   when you file your taxes to claim  the Earned Income Tax Credit. This could get you a larger refund. So, figure the credit with and without your combat  pay and make the choice that’s best for you. Also… if you transfer to a  new duty station…    you may be able to deduct unreimbursed moving expenses. If the military reimburses you for those expenses…  you don’t need to pay tax on that amount. Here’s another. If you’re a reservist and your duties  take you more than 100 miles from home…   you can typically deduct  unreimbursed travel expenses. For more information about these tax  benefits, head over to irs.gov/military.

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