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New Member
posted Jun 6, 2019 4:14:55 AM

I currently owe $548 dollars in state tax for Indiana while I am currently station in Texas for the Navy. Is there a way to get that number down?

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1 Best answer
Expert Alumni
Jun 6, 2019 4:14:57 AM

It depends.  Since Indiana does tax military income (although $5,000 is excluded), it is difficult to say if there are additional credits to which you are entitled to.  However, I can think of two things.  First, make sure that your W-2 is marked as active duty military:

  1. Sign in to TurboTax Online, click take me to my return, then pick up where I left off.
  2. Click on Wages and Income, then Edit on your W-2
  3. Scroll through the screens until Do any of these uncommon situations apply?  Make sure the Active Military Box is checked.

Second, make sure that you have selected Out of State as the Indiana county in which you live and work in.  Indiana charges county taxes on the state return, and if you have left in your old county of residence, it is probably counting that when it should not.  While you are still considered a resident of Indiana because of military residence rules, you are not a physical resident of any county and should not claim any.

Having said this, if you have an opportunity to establish Texas residency by filing DD Form 2058 with DFAS, you might find it advantageous to do so, because Texas has no state income tax.

1 Replies
Expert Alumni
Jun 6, 2019 4:14:57 AM

It depends.  Since Indiana does tax military income (although $5,000 is excluded), it is difficult to say if there are additional credits to which you are entitled to.  However, I can think of two things.  First, make sure that your W-2 is marked as active duty military:

  1. Sign in to TurboTax Online, click take me to my return, then pick up where I left off.
  2. Click on Wages and Income, then Edit on your W-2
  3. Scroll through the screens until Do any of these uncommon situations apply?  Make sure the Active Military Box is checked.

Second, make sure that you have selected Out of State as the Indiana county in which you live and work in.  Indiana charges county taxes on the state return, and if you have left in your old county of residence, it is probably counting that when it should not.  While you are still considered a resident of Indiana because of military residence rules, you are not a physical resident of any county and should not claim any.

Having said this, if you have an opportunity to establish Texas residency by filing DD Form 2058 with DFAS, you might find it advantageous to do so, because Texas has no state income tax.