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Troops Deployed In Combat Areas Get Tax Credit Options

By Gerry J. Gilmore
American Forces Press Service

WASHINGTON, Feb. 17, 2005 – Servicemembers receiving federal tax exemptions for some or all of their military pay may now elect to apply for certain tax credit options, the chief of the Armed Forces Tax Council said here today.

Troops deployed to combat zones can now apply for tax refunds based on earned income tax credits, as well as additional child-tax credits, explained Army Lt. Col. Janet Fenton, the AFTC's executive director. The AFTC monitors and coordinates tax issues involving active and reserve-component military members.

The earned income credit, Fenton explained, primarily involves lower-income filers with children. The additional child tax credit, she added, may provide refunds for children under age 17.

Servicemembers who want to apply for the credit refunds are required to fill out and file a federal tax return, Fenton noted.

Enlisted troops serving in combat areas already have all of their military pay excluded from federal taxes, Fenton pointed out, while officers in combat zones can exclude up to $6,529 of their monthly pay.

Troops deployed to non-combat overseas areas have until June 15 to file their income taxes, Fenton said.

Troops serving in a combat zone, she pointed out, have up to 180 days to file their taxes after departing the area.

For example, "someone who is in Iraq right now," she noted, "would not have to file their 2004 tax return until they leave Iraq."

However, some overseas servicemembers would want to file early, Fenton said, because they may be due a refund. Military-operated tax centers at stateside and overseas locales, she noted, can provide service members with tax filing assistance.

And, married service members deployed to combat and non-combat overseas locales can opt to have spouses file tax returns, she noted, provided there's an applicable power of attorney.

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