topic How do I file state taxes for spouse in DC in Tax help for military filers

How do I file state taxes for spouse in DC

taylorjet — Mon, 08 Mar 2021 14:22:46 GMT

I am an active duty military stationed in Washington DC and a resident of Iowa. My wife is a homemaker who registered to vote in Washington DC in October of 2020. Her only income is the joint interest and dividends that we receive on our joint accounts.

Washington DC requires the spouse of exempt military persons to file.

I have downloaded the Iowa and the Washington DC modules to Turbo Tax Premier. We are "married filing jointly" on our federal return and "married filing separately on a joint return" on our Iowa return.

Question 1: How do I characterize the DC return for my spouse?

Question 2: Turbotax lists me as the taxpayer for DC. Shouldn't it list my spouse as the taxpayer, and me as the Spouse on the DC return since I am not the filer as I am exempt due to being military?

Re: How do I file state taxes for spouse in DC

TomD8 — Mon, 08 Mar 2021 15:17:43 GMT

Section 302 of the Veterans Benefits and Transition Act of 2018 ("VBTA") allows the spouse of an active duty servicemember the option to file state and local taxes as a resident of the servicemember's state of legal residence, even if they have no other connection with that state. See page 3 of this reference:

https://www.jag.navy.mil/legal_services/documents/Info_Paper_2018_SCRA_Amendments.pdf

Therefore, you and your wife may both file as residents of Iowa. She would then have no obligation to file a DC tax return.

If she chooses to do this, in the My Info section of TT, enter Iowa as the State of Residence for both of you.

Re: How do I file state taxes for spouse in DC

taylorjet — Mon, 08 Mar 2021 19:37:33 GMT

Thank you very much. This is helpful! We will keep the Iowa residency, then!