Military Pay
Resident - Active duty - Active duty military income is excluded from taxation in Missouri. To subtract active duty military income in the Missouri individual return in TaxSlayer ProWeb, from the Missouri resident tax return menu select:
- Other Deductions
- Military Income Deduction - Enter the income as a positive number.
Resident: Inactive Duty - A portion of inactive duty pay from these sources may be excluded from Missouri income:
- National Guard Inactive Duty Training (IDT)
- National Guard Annual Training (AT)
- Reserve components of the Armed Forces
The following reflects the percentage of Military reserve or inactive duty income that may be deducted in each applicable tax year:
- 2022 - 60%
- 2023 - 80%
- 2024 - 100%
Multiply the amount of inactive duty military income earned by the applicable percentage. For example in 2023 with inactive pay in the amount of $2,000 multiplied by 80%, the allowable deduction to enter would be $1,600. To subtract inactive duty military income, from the Missouri resident tax return menu select:
- Other Deductions
- Inactive Duty Military Income Deduction - Enter the allowable income as a positive number.
Note that in order to qualify for the Active Duty or the Inactive Military Income deductions, Missouri requires copies of all Leave and Earnings statements to verify duty status for the income being claimed as a deduction. A PDF copy of the taxpayer's LES can be uploaded on the Military Income Deduction menu. Failure to attach the requested documentation may result in the disallowance of this deduction.
Resident: Stationed Outside Missouri - Military members whose home of record is Missouri, but are stationed outside of Missouri, may also be able to subtract military income if they did not spend more than 30 days in Missouri or maintain a residence in Missouri. They must also have maintained a residence elsewhere.
To subtract military pay from income earned while stationed outside of Missouri, from the Missouri resident tax return menu select:
- Subtractions from Income
- Enter Other Subtractions from Income and select type below - Enter the qualifying income as a positive number, scroll down and select YES for Is other subtraction from a Military Nonresident Income?
To subtract military pay from income earned while stationed outside of Missouri, from the nonresident Missouri menu select:
- Military Nonresident Tax Status - Answer applicable questions.
Nonresident - If the taxpayer is a nonresident of Missouri stationed in Missouri whose only source of income is active duty military pay, they are not required to file a Missouri return.
One spouse is a resident of Missouri 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 Missouri 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 Missouri .
Missouri 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 Missouri return and the spouse will be required to use the same residency status as the servicemember. The resident will need to file a nonresident Missouri return.
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 Missouri , the following conditions must be met by the military spouse/employee:
- Currently resides in Missouri.
- Resides in Missouri solely to live with the servicemember spouse.
- The servicemember spouse is in the state of Missouri in compliance with military orders.
- The state of domicile claimed by the servicemember and spouse must be the same.
If the military spouse meets the eligibility requirements, they can avoid Missouri state tax from being withheld from their pay by providing their employer with Form MO W-4 Employee Withholding Certificate.
To claim a refund of taxes withheld from the Missouri income in error, from the Missouri nonresident return select:
- Military Nonresident Tax Status - Answer applicable questions.
- Subtractions from Income
- Enter Other Subtractions from Income and select type below - Enter the spouse income as a positive number and select Yes to Is other subtraction from a Military Nonresident Income?
Note: This is an article on reporting military pay and military spouse pay in TaxSlayer ProWeb. It is not intended as tax advice.
Additional Information: