- General Rules
- Nonresident Military Service Personnel
- Where to Report on original tax Return; What to Enclose
- Massachusetts References
Military service compensation includes both:
- compensation earned by members of the armed forces for service in a combat zone (which is always excluded from gross income to the extent excluded federally. For more information, see Compensation for Active Service in a Combat Zone by Members of the U.S. Armed Forces
- any other military service compensation which is included in Mass gross income.
Nonresident Military Service Personnel:
Military service compensation paid by the United States to its uniformed military personnel assigned to duty at military posts, bases or stations within the commonwealth for services rendered by said personnel while on active duty shall be deemed to be from sources other than sources within the commonwealth.
Non-Massachusetts Military Service Compensation.- Massachusetts Adopts Compensation Exclusion for Tax Years Beginning on or after January 1, 2003:
The Federal Service members Civil Relief Act (P.L. 108-189) provides that a tax jurisdiction may not use military service compensation of a nonresident service member to increase the tax liability imposed on other income earned by the nonresident service member or spouse subject to tax by the jurisdiction.
Nonresident taxpayers who have a filing requirement in Massachusetts because they have MA source income other than military source income:
- should not include any military service compensation as non-Massachusetts source income when determining whether they qualify for NTS or LIC. Specifically, Line 7 of Schedule NTS-L-NR/PY should not include as non-Massachusetts source income any military service compensation received during the taxable year;
- should include military service compensation as non-Massachusetts source income when determining the deduction and exemption ratio. Specifically, Line 14e of Form 1-NR/PY must include as non-Massachusetts source income any military service compensation received during the taxable year.
- Enter amount on Form 1, Line 3 or Form 1-NR/PY, Line 5