During these hot summer months, tax season can (perhaps thankfully) seem miles away. But the truth is, it’s never too early to start thinking about your potential benefits and how to save your family money come tax day. This week we’re talking to you, military families. If you or a family member serve in the military, you may be eligible for a wealth of tax benefits and it’s our goal to help you save. For a complete list of tax benefits available to you or your family, be sure to check out the IRS’s Armed Forces’ Tax Guide. In the meantime, check out our interview on OKC Fox 25 and keep these tips in mind when it comes to your taxes.
Combat pay
If you or a family member have served in a combat area within the past year, you may be able to exclude certain pay from your income when determining your taxes. And for low- and moderate-income service members serving in combat zones, a special computation method is available to provide family-friendly tax benefits through the Earned Income Tax Credit.
Travel and moving deductions
Military families know as well as anybody that all that traveling and moving can be expensive. But there’s good news: Military reservists whose duties take them more than 100 miles from home can deduct unreimbursed travel expenses using Form 2106 or Form 2106-EZ. For those of you on the move, take note that eligible unreimbursed moving expenses are also deductible on Form 3903. Be sure to keep those forms handy and fill them in as you travel to make deductions easier come tax season.
Benefits for low- and moderate-income service members
Low- and moderate-income service members may qualify for family friendly tax benefits through the Earned Income Tax Credit. Be sure to review this document for benefits that may benefit you or your family. And for those individuals who contribute to an IRA or 401(k)-type retirement plan (e.g. the Thrift Savings Plan or others), you may be able to claim the Retirement Savings Contributions Credit using Form 8880.
Extended deadlines for military
Traveling or living abroad can be a nightmare during tax season, but fortunately, there’s no need to stress over that April 15th deadline. Service members stationed abroad have until June 15th to file a federal income tax return. Those serving in a combat zone have even longer, typically 180 days after leaving the combat zone.
To all of our military servicemen, women, and family: Thank you for your service. And remember, as tax season draws closer, we are here to help! If you have any questions for us, please feel free to browse our services page and fill out the form for a free consultation. You can even call us at 844-841-9857!