You have certain financial and civil protections under both federal and state versions of the Servicemembers Civil Relief Act (formerly the Soldiers and Sailors Civil Relief Act). These protections occur when you enter military service, and when you are called up for active duty as a member of the Reserve or Guard. Under this law, your protection begins on the date you enter active service, or the date your orders begin, and generally terminates within 30 to 180 days after the date of your discharge depending on the right. To receive some of the protections, you have to be prepared to show that military service has had a "material effect" on the legal or financial matter. Protections include:
  • Ceiling on maximum rates of interest
  • Rent and eviction
  • Termination of residential leases
  • Motor vehicle leases
  • Protection from court proceedings
  • Mortgage foreclosures
  • Life and professional insurance
  • Income taxes
  • Residency for tax purposes
  • Taxes and assessments on personal/real property
  • Foreclosures on installment contracts
  • Health insurance
  • Cell phone contracts

I just took out a car loan at 7.5%. What are my rights?

If prior to your entry into the service or your call-up you take a loan or other obligation more than 6%, including credit cards, your creditor is required to drop the interest rate to 6% upon written application to the lender. Charges in excess of the 6% rate will be forgiven unless a court finds that your ability to pay was not materially affected.

  • For more information, see Servicemembers Civil Relief Act by visiting www.uscg.mil/legal/la and go to "Servicemembers Civil Relief Act."

Do I have to pay income taxes while on active duty?

Yes. But if you are a Massachusetts resident and you are serving in a combat zone, you can request an extension of time to file, for the period of time you are in the combat zone plus six months after that, and you will not be charged interest or penalties during this time on your Massachusetts taxes. You must have paid 80% of your taxes by the original due date, including withholding, estimated payments, and payments made with an extension. If you request the extension after the taxes are due, you will incur fees and penalties. The same rule applies to your federal taxes.

  • For more information, see www.mass.gov/dor. Do a search for "Frequently Asked Questions-Massachusetts State Income Tax." Answer number 14 addresses veterans' tax.

Is there any way to get out of my cell phone contract while I'm overseas for the next twelve months?

Yes. Under the Veterans' Benefits Improvement Act, cell phone contracts may be cancelled or suspended without penalties or fees if the servicemember is deployed overseas for 90 days or longer.

  • Public Law No: 110-389 Title VIII s805 signed in 2008.
  • The SAVE Team may also be able to assist you. Email save@massmail.state.ma.us or call (888) 844-2838.

I signed a one-year lease on my apartment and then I received orders to Iraq. Can I get out of the lease?

Yes. If you sign a lease for an apartment, you can break the agreement with written notification and a copy of your orders, so long as your orders are for more than 90 days or for a permanent change of duty station. Your rent will be prorated for the period of time before you give notice. In the event that you do not terminate your lease until after you return, you are protected from the landlord's legal action while you are away. But you will be liable for any unpaid rent due before you gave notice.

  • For more information, see the federal Soldiers and Sailors Civil Relief Act of 1940 (SSCRA), 50 United States Code, Appendix s. 510 (amended by Public Law 108-189, December 19, 2003).

Does the Commonwealth pay a bonus to veterans of Iraq and Afghanistan?

Yes. The Commonwealth of Massachusetts will pay a bonus to each servicemember who served in Armed Forces in active service as part of Operation Enduring Freedom, Operation Iraqi Freedom, and Operation Noble Eagle who was discharged under honorable conditions. You must have lived in Massachusetts for six months prior to entry into the military. The bonus payment is based on where you served. Veterans who served outside the continental limits of the U.S. in the Afghanistan or Iraq area receive $1000. Those who served within the continental limits of the U.S. or outside the continental limits of the U.S. other than in the Afghanistan or Iraq areas for a period of six months or more receive $500. Servicemembers who deploy more than once may be eligible for a partial additional payment.

  • For more information and to apply, download an application at www.mass.gov/treasury or contact the Veterans Bonus Division at Office of the State Treasurer (617) 367-9333, x539.

If I need it, can I get financial assistance?

Yes. The Massachusetts Department of Veterans' Services offers a needs-based program of financial and medical assistance for veterans and their dependents under M.G.L. Chapter 115. Every city and town has a Veterans' Services Officer (VSO) who administers this program for those with a discharge under honorable conditions. They help you apply for a range of other programs including VA and Social Security benefits. There is also a $2000 annual annuity available for certain blind, paraplegic, or 100% service-connected disabled veterans, as well as to the spouse and parents of those deceased veterans whose deaths were service-connected.

  • For more information and to apply, contact your local Veterans' Services Officer (VSO) or go to www.mass.gov/veterans.
  • For more information and to apply for the annuity, visit www.mass.gov/veterans or call (617) 210-5927.

I'm in the Reserves and my family is having trouble financially due to my deployment. Where can they turn for assistance?

The Military Friends Foundation administer the Military Family Relief Fund, as a needs-based program (eligibility is based on approximately a 30% difference between civilian and military pay) to assist those families who are suffering a financial hardship due to military deployment. You will be asked to supply both military and civilian pay stubs. Also, the USO has discretionary funds that can be issued quickly to help family members of military personnel who are on active duty. Guard members may receive emergency financial assistance from the Guard Support of Massachusetts. The SAVE Team may know of resources for all veterans. Finally, talk to your branch of service for other resources.

What if I need a loan?

If you are a member of the Massachusetts Guard or a resident Massachusetts Reservist called up, you can get a one-time loan up to $10,000 at 3% interest payable upon completion of active duty plus two years.

  • For more information, contact the office of the State Treasurer, (617) 367-3900 or your Family Assistance Center.

Where can I get help managing my money?

The Treasurer's Financial Education Department is a statewide resource for all Massachusetts residents and empowers individuals to learn about a broad spectrum of financial matters. The Military and Family Support Center may have workshops or other resources.

  • For more information on the Financial Education Department's programs, visit www.mass.gov/treasury or call (617) 367-6900.
  • Contact the Military and Family Support Center by calling (800) 772-1237.
  • Check the DVS website for information on periodic financial literacy workshops, www.mass.gov/veterans.

What is VA Compensation and am I eligible?

VA compensation is a monthly stipend paid to you for disability incurred or aggravated during your military service. If you have a service-connected disability and you were discharged under other than dishonorable conditions, you may be eligible for this benefit, which is not taxable by the state or the federal government.

  • For more information or to apply, contact the VA Boston Regional Office at (800) 827-1000.
  • For direct assistance and referral, contact your local Veterans' Services Officer (VSO) at City/Town Hall or call the SAVE Team at (888) 844-2838.

(Welcome Home, 3rd edition, April 2010.)

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