I will never have someone else do my taxes again.
That was my very first thought when I showed up at the tax prep center, paperwork in hand. The seasonal worker complimented me on the most organized paperwork he had ever seen. He was a nice guy but he even needed my help to enter my information in the computer system he had.
If in the future I’m blessed to have so many different sources of income and deductions that my tax situation is really complex, I’ll hire an actual professional. But I’ll never, ever pay to go to a pop-up tax center again.
Part of the reason I’ll never do that again is that there are a few other really solid options. Several different companies offer great resources for service members that allow them to file their taxes fast, easy and free. So we can get back to warfighting… or scrolling tik tok while we’re supposed to be working or… whatever you choose to do.
MilTax: 100% free tax filing for active duty and some veterans. NO INCOME LIMITS
Miltax is 100% free tax software provided by the DoD and powered by H&R Block’s premium tax software. You can access it through Military One Source. It’s free for active duty, national guard & reserve, service academy cadets, and veterans / retirees (up to 365 days past separation). Unlike other tax software that is supposedly “free” there are no income limits and you can file your federal and up to 3 state returns for genuinely no cost.
An amazing benefit is that you also have free access to phone consultations with military tax professionals. Military family taxes can get pretty complex, from things like moving from one state to another and buying, selling or renting a house to combat zone tax exclusion (CZTE) to spousal income, rental properties, etc. The Miltax tax professionals on the line can walk you through what you need to do and can direct you where to input things in the H&R Block software. It’s a resource I have used every single year, if only as a double check. Keep in mind that everyone waits until the tax due date to do their taxes. If you knock it out early, you should be able to call in and talk to someone right away. If you are calling the week before April 15th, expect a scheduled callback sometime in the next couple days.
Side note: If you haven’t used it before, Military One Source isn’t just a great resource for all the tax stuff mentioned above, they also provide confidential counseling. It is one of the easiest and fastest places to send anyone that may be struggling with mental health. They also have financial counseling and language translation services…for when one of your Marines decides to play 90 day fiance and marry a local girl he met on deployment.
Volunteer Income Tax Assistance (VITA)
Through the Volunteer Income Tax Assistance program, IRS certified volunteers provide in-person tax advice and filing help for moderate- to low-income filers. Even better, this service is available on many military installations all around the world. For 2024 the income threshold is $67,000 a year. Since BAH & BAS are not taxed, that limits applies just to base pay. So we’re talking about free in-person tax help for a newly minted O-2 or E-7 with 14 years and below.
Military Spouses Residency Relief Act (MSRRA) to reduce your taxes
The Service Members Credit Relief Act (SCRA) is not just about debt reduction and credit card benefits. The SCRA also allows servicemembers to maintain their legal state of residency even when they are transferred elsewhere. The Military Spouses Residency Relief Act (MSRRA) was passed in 2018 and it allows military spouses to claim their service member’s legal state of residence as their own. Put these two things together and it means that if you have ever been stationed in a low-tax or no-tax state, active duty servicemembers and their spouses can keep that as their legal state of residence. So even if you no longer physically reside there, you can both remain legal residents and pay that lower tax rate.
How to get started: Where to find your W-2
The first thing you’ll need is your W-2. You can find that on the Defense Financial Accounting Service (DFAS) website. The Department of Defense uses the “myPay” user portal on the DFAS website to provide service members with access to their monthly paychecks (LES, or Leave and Earning Statements) and their tax documents. The site is fairly easy to navigate (for being a military website). You sign in with your CAC.
Relatively low tax rate for military
A lot of our posts will be about how to make your life better as a service member. Honestly, though, this one is about making it less bad. Filing taxes sucks but there’s no way around it. The best you can do is get the best advice you can for no cost. Relatively speaking, service members pay a lower tax rate thanks to untaxed allotments such as Basic Allowances for Housing (BAH) and Basic Allowance for Subsistence (BAS). We’ll be back next time with more sweet bennies. Until then, get a head start on those taxes, it’ll be middle April before you know it.