My husband is active duty military and home of record is KY. Its making us pay state taxes? AM I doing something wrong? There's no state income tax listed on his W2.

nicole-a-zegers · ‎May 31, 2019

DanielV01 · ‎May 31, 2019

It depends. Kentucky does not tax active duty military income, so what is listed on his W2 is correct. You might want to double-check your entries to make sure that TurboTax is properly calculating this. Look at the following entries:

First, double-check your entries in the Personal Info Tab. Answer “no” to the question “Did you live in another state besides [Kentucky]” and “no” to the question “Did you earn money in another state besides [Kentucky]?”

Next, double-check your entries for your W-2:

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. Your KY military pay should be excluded from your state taxable income.

Here is what your screen should look like:

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View solution in original post

DanielV01 · ‎May 31, 2019

It depends. Kentucky does not tax active duty military income, so what is listed on his W2 is correct. You might want to double-check your entries to make sure that TurboTax is properly calculating this. Look at the following entries:

First, double-check your entries in the Personal Info Tab. Answer “no” to the question “Did you live in another state besides [Kentucky]” and “no” to the question “Did you earn money in another state besides [Kentucky]?”

Next, double-check your entries for your W-2:

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. Your KY military pay should be excluded from your state taxable income.

Here is what your screen should look like:

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

nicole-a-zegers · ‎May 31, 2019

I'm still having trouble with the state taxes. It says we owe money, but its taxing my income when I'm a Texas resident?

DanielV01 · ‎May 31, 2019

If your husband did not establish residency in Texas with you, then you will have taxes to pay to Kentucky because of how your residency is treated. I am going to follow this comment with a second answer that shows the Military Spouse Rules. If he can establish Texas residency with you that will benefit you both because any state in which you are stationed in will have to tax you as a Texas resident (no state tax). Now, all states will tax you (the military spouse) as a Kentucky resident if you established residency in Kentucky.

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nicole-a-zegers · ‎May 31, 2019

Okay that makes MORE sense to me now. Thank you for explaining!

DanielV01 · ‎May 31, 2019

Here are the two FAQ's to help assist:

MILITARY STATE RESIDENCY RULES: https://ttlc.intuit.com/replies/3300147

MILITARY SPOUSE STATE RESIDENCY RULES: https://ttlc.intuit.com/replies/3302300

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My husband is active duty military and home of record is KY. Its making us pay state taxes? AM I doing something wrong? There's no state income tax listed on his W2.