What state does my military spouse file taxes under?

[dallas72001]

My home of record is Hawaii. My spouse is originally from Texas however we were stationed in Hawaii until August of 2018. She became a resident of Hawaii while we were there. We PCSed to WA in August and she has not received income from the state of WA yet, although she is a student in WA. What state does she claim?

[DanaB · Accepted solution]

She will have have to claim Hawaii for 2018 because she established residency there and it was your home of record. 

For the future, your spouse can choose to claim your state of legal residency (SLR) / Home of Record (HOR) for tax purposes because of the Military Spouses Residency Relief Act (MSRRA) even when being stationed in a different state. Her income from other states would then be taxable in your SLR. Or she could choose to become a resident of the state that you are living in and you would have to file separate state returns.

You might want to consider to change your state of legal residency (SLR) to WA to benefit that WA doesn't have a state income tax. To change the SLR, a DD Form 2058 must be submitted to your local finance officer and accepted.

Please see this FAQ for additional information:

https://ttlc.intuit.com/replies/3302301