Overseas military community has extra income-tax filing time
April 15, 2003
Servicemembers and Department of Defense civilians living overseas who haven’t filed their 2002 tax forms do not have to press the panic button.
Tuesday is the stateside deadline for filing federal and state income taxes. It’s also the deadline to paying taxes that are owed.
But servicemembers and civilians living in Europe, Asia and throughout the world have a June 15 filing deadline, said Stephen W. Smith, chief of client services for the 21st Theater Support Command’s judge advocate general’s office in Kaiserslautern, Germany.
“About 95 percent of our military taxpayers are getting refunds,” Smith said. “If they’re getting refunds, there’s no need to worry about the April 15 deadline at all.”
The two-month extension is only for filing, not an extension to pay any tax liability. If a tax liability is due, interest will be assessed from April 15.
In addition, deployed servicemembers and their families get an additional 180 days to file.
“No penalties or interest accrue while you’re deployed,” Smith said. “They shouldn’t even have to worry about it until they’ve been back for some time.
Staff Sgt. Tara Cuestas, a tax preparer with the Darmstadt Tax Center at Cambrai-Fritsch Casern, said servicemembers can get answers to their tax questions from the Internal Revenue Service Web site at www.irs.gov.
Clicking on the “Armed Forces Tax Benefit” section will provide servicemembers with:
• Questions and answers on combat zone tax provisions.• An e-mail address to alert the IRS if you are serving in a combat zone: email@example.com.• Publication 3, Armed Forces’ Tax Guide, issues that affect military members.• Tax forms that can be printed.• A fact sheet and tax tips.
“Each state also has its own Web site, so soldiers can go in there and find all the information for state taxes,” Cuestas said.
Many bases have tax return offices where specialists such as Cuestas help servicemembers complete their paperwork and file their federal and state taxes electronically. In Darmstadt, the counselors schedule appointments on Mondays, Wednesdays and Fridays. Help is available for walk-ins on Tuesdays and Thursdays.
Smith and Cuestas said mistakes made by taxpayers include not having an up-to-date W-4 form that correctly lists all dependents, not having an individual taxpayer identification number for eligible spouses and dependents, and incorrectly listing the taxpayer’s name on the return.
That includes middle initials — Jr., Sr., II, III and so on.
“Lots of soldiers are downrange,” Cuestas said. “Sometimes their wives are doing the taxes and don’t know if they are a Jr. or Sr. or what exactly is on their Social Security card.”
A spokeswoman at the IRS office in Berlin said the agency’s goal is to have 80 percent of returns filed electronically within a few years.
“All the bases have excellent groups of people there to help them,” the spokeswoman said. “They’re very good. They process thousands of forms.”
Exemptions by state
State exemptions for military income:
• States that exclude all military pay from state income taxes: California, Illinois, Michigan, Minnesota, Missouri, New Jersey, New York, Oregon, Vermont.
• States that have a maximum amount they will exempt from state income taxes:
Arkansas: $6,000.Colorado: All military pay if overseas 305 days.Idaho: All military pay, plus grocery credit.Indiana: $2,000.Maryland: $15,000.Montana: All military pay exempt, but must file to maintain residency.North Dakota: $300 per month for each month spent overseas.Ohio: All military pay, but must provide an Ohio affidavit.Oklahoma: $1,500.Pennsylvania: All military pay if earned outside Pennsylvania. Need copy of orders or affidavit.Virginia: Up to $15,000.Wisconsin: $200 if stationed overseas.
• Other states do not exclude military pay.
Source: Darmstadt Tax Center, Germany