If you happen to be in the U. S. Armed Forces, unique income tax breaks could possibly affect you. For instance, certain kinds of earnings are not taxed.
Specific rules relate to deductions or credits which you can claim to minimize your taxes. In some instances, you might get a longer period to submit your income tax return. You might even get extra time for you to pay your taxes.
Listed below are the top 10 IRS income tax tips regarding these set of rules:
- Extension of deadlines. Certain individuals in the armed forces like those who operate in a war zone, are able to put off certain tax deadlines. If this is true for you, you are able to get automatic deadline extensions to submit your tax return as well as to pay your income taxes.
- Combat salary exclusion. For those who work in a combat area, some combat earnings you receive are not taxed. You won’t have to display the earnings on your income tax form since combat earnings are not part of the income disclosed on your Form W-2, Wage and Income tax Statement. In the event you function in a supporting role in a war zone, you are entitled to this exemption.
- Earned Income Tax Credit or EITC. When you get nontaxable combat income, you are able to include it to determine your EITC. Doing this will increase your credit. Even when you do, the combat earnings remain nontaxable.
- Deducting moving expense. Your unreimbursed moving expenses might be deductible. It applies in cases where the move is a result of a permanent station change.
- Deduction for uniforms. The costs of select uniforms that you cannot wear when off duty can be deducted. This also includes the costs of buying and maintaining the uniform. If you get any allowances towards these costs, you have to reduce the deduction by that amount.
- Signing joint returns. Both spouses usually have to sign a joint income tax return. You might be able to sign on the behalf of your spouse f they are away because of military duties. In other instances a power of attorney might be needed to file a joint tax return if your spouse is away.
- Reservists’ travel deduction. Members of the U.S. Armed Forces Reserves might be able to deduct the expense of travel on their tax return. This will apply if unreimbursed travel expenses to carry out your reserve duties are over 100 miles away from your house.
- ROTC allowances. Money paid to ROTC students for advanced training is not taxable. These amounts include allowances for subsistence and education. However active duty ROTC income is taxable. For example, advanced summer camp income is taxable.
- Civilian life. Some job search costs might be deductible once you leave the military and are looking for a job. You might be able to claim expenses for travel, resume preparation and fees for job placement agencies. Expenses for moving might also be tax deductible.
- Tax help. The majority of military bases provide free preparation of income taxes and submission help when tax season rolls around. The help often extends beyond the April 15 deadline.
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