Civilian pay earned by active duty military

SOLVED•by TurboTax•1173•Updated November 22, 2023

The Service Members Civil Relief Act of 2003 continues to provide that active duty military members may only be taxed on their military pay by their state of legal residence (often the same as their home of record).

If you aren't sure of your military state of legal residence (SLR), we have guidance on how to determine it.

However, if you're an active duty service member and also work a nonmilitary/civilian job or are freelancing, you'll probably have to file taxes as a nonresident in the state you're physically working in.

If you have to file a state tax return for your state of legal residence, most of the time you can get a credit for the taxes paid on your nonresident return.

Example

Jo joined the military in Georgia, their state of legal residence. However, they're currently stationed in Virginia. On the weekends, Jo works at the local hardware store.

Jo will have to file a Virginia nonresident tax return and will only be taxed on their nonmilitary wages. They'll also file a resident state return with Georgia. The Georgia return will include both their military and nonmilitary wages and all other taxable income. Georgia allows a credit for the Virginia taxes paid on the Georgia state tax return.

Spouse of an active duty service member

The rules for what state the spouse of a military service member needs to file in aren't the same as for active duty military. For more info, see our article on military spouses and state taxes.

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