Military Pay
Resident - If the taxpayer is a resident of Connecticut they are subject to Connecticut income tax on all income regardless of the source. This includes active duty military pay.
Nonresident - If the taxpayer is a nonresident of Connecticut stationed in Connecticut whose only source of income is active duty military pay, they are not required to file a Connecticut return.
One spouse is a resident of Connecticut and the other is not - A servicemember’s spouse may elect, for income tax purposes, to use the same state of residence as the servicemember. If a servicemember is not a Connecticut resident, and is instead a resident of another state, his or her spouse can elect to also be a resident of that state and not a resident of Connecticut.
Connecticut does not permit a filing status change from the federal return. If they are married filing joint on the federal return, they are required to file married filing joint on the Connecticut return and the spouse will be required to use the same residency status as the servicemember.
Spouse Income - Military Spouses Residency Relief Act (MSRRA)
The MSRRA allows military spouses who reside with their service member spouse stationed in a nonresident state on military orders to keep their resident state for tax purposes. This means if the spouse has income from the nonresident state, they are not required to pay taxes to the nonresident state but report this income on their resident state return.
In order to be eligible for the income exemption under the MSRRA in Connecticut , the following conditions must be met by the military spouse/employee:
- The military spouse and the servicemember have the same state of domicile other than Connecticut;
- The military spouse is in Connecticut solely to be with the servicemember; and
- The servicemember is in Connecticut serving in compliance with military orders.
If the military spouse meets the eligibility requirements, they can avoid Connecticut state tax from being withheld from their pay by providing their employer with an Form CT-W4 Employee’s Withholding Certificate.
To claim a refund of taxes withheld from the Connecticut income in error, from the nonresident Connecticut Tax Return Menu select:
- Income From CT Sources (Schedule CT-SI)
- Adjustments to CT Income
- Other Adjustments - Enter the spouse wages as a negative number.
Note: This is an article on reporting military pay and military spouse pay in the TaxSlayer Pro program. It is not intended as tax advice.
Additional Information:
Connecticut DRS: State Income Tax Information for Military Personnel and Veterans
Connecticut DRS: Individual Income Tax Return Forms & Instructions
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