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dtw136
New Member

My husband received non-taxable combat pay last year and I listed it under earned income per his W2 in box 12, code Q. Do we get Earned Income Credit for it?

 
2 Replies
WillK
Level 9

My husband received non-taxable combat pay last year and I listed it under earned income per his W2 in box 12, code Q. Do we get Earned Income Credit for it?

Per the IRS: "Combat pay is exempt from income taxes, thus providing military personnel with additional compensation for serving in dangerous areas you can choose to count your nontaxable combat pay as earned income to qualify for the Earned Income Tax Credit. "

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dtw136
New Member

My husband received non-taxable combat pay last year and I listed it under earned income per his W2 in box 12, code Q. Do we get Earned Income Credit for it?

Turbo Tax said we don't qualify for Earned Income Tax Credit whether or not I include the combat pay under W2 income information on Turbo Tax. Is that because our total income is greater than the maximum requirement? Turbo Tax only mentions combat pay under EIC as a special circumstance saying "Nontaxable combat pay. If you or your spouse earned nontaxable combat pay, you can choose to either include or exclude the full amount of this income when calculating your earned income for the purposes of the EIC. TurboTax helps you choose the option that gives you the highest credit."
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