Military Spouse and State Taxes

[Maz Mehio]

Hello,

I'm an Active Duty Military member and a resident of Florida who's currently station at Ft Bragg, NC. My wife (also a resident of FL) works as a Yoga instructor here in North Carolina. Just want to confirm that I understand this correctly: Under the MSRRA, my wife would file her state taxes in FL as well. Is this correct? Or would she have to file for state taxes in NC where she is employed?

Thanks for the help!

--M

[DavidD66 · Accepted solution]

Under MSRRA, your wife is not subject to North Carolina tax.  If she is an employee, and North Carolina tax was withheld, she will have to file a NC return to get a refund.  Since you (and she) are a resident of Florida, and Florida does not have a state income tax, you will not have to file a state income tax return unless it's to receive a refund of tax withheld.

[Sj45]

I am a separated military spouse, and we are currently stationed and currently live in NC, but our state of residency is in Arizona. My NC state taxes are showing that I owe NC because my employer has my signed documents stating I am a mil spouse. What do I need to do in turbo tax so that I am not owing?

I am very frustrated by the software this year. Last year it asked me and when I checked it, then it corrected my data.

Please help! Frustrated!

[DMarkM1]

It sounds like NC did not withhold anything and is not on any of your W2s.  If that is the case, in the "My Info" section be sure that AZ is selected as the resident state for both of you.  Indicate that neither you lived in any other state.  Scroll down to "Other State Income" and select "No" if you have no other income besides military pay and your W2 income.  Then you can delete the NC return from the state interview section.    

[Kristenlee83]

This sounds similar to our situation. Husband is active duty and we are currently stationed in Virginia. We are BOTH residents of Florida (it's on his W-2 from the military as well.) I have a small business (mostly online) and made money while living in Virginia. Everything points to us filing in FL, except that we purchased a home in Virginia. I am not sure where to file.