1. Do I have to file a tax return if all my income is military pay?

Yes, in most cases. While certain types of military pay (like combat zone exclusions or allowances) may be non-taxable, you still need to file a federal return if your total income exceeds the IRS filing threshold. If you or your spouse has additional income, such as freelance work or investment income, that must also be reported.

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2. Can my spouse keep their original state of residence under MSRRA?

Yes — if the Military Spouse Residency Relief Act (MSRRA) applies. If your spouse moves due to your PCS orders, they may elect to maintain their legal residence (domicile) in their original state for voting and tax purposes, as long as certain conditions are met.

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3. Does MSRRA apply if my spouse is self-employed?

Not always. MSRRA protections generally apply to wage income. Self-employed spouses may still be subject to state taxes in the state where the work is performed. It’s best to review state-specific rules and speak with a professional if your spouse runs a business or freelances.

 

4. We moved — do we still need to file a state tax return?

Maybe. If you maintain ties to your “home” state — such as a driver’s license, voter registration, or property — you may still owe state taxes there. If you or your spouse earns income in a new state (especially self-employment), that state may expect a return too. Each state has its own rules.

 

5. Do I have to report foreign bank accounts while stationed overseas?

Yes. If the combined balance of all foreign accounts (bank, investment, etc.) exceeds $10,000 at any point during the year, you must file an FBAR (FinCEN Form 114). Even if you don’t owe tax, you must report those accounts.

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6. How does USERRA affect my taxes?

The Uniformed Services Employment and Reemployment Rights Act (USERRA) protects your job when you return from active duty. While it doesn’t change your federal filing requirements, it may affect:

• State residency and tax timing

• Retirement contributions and catch-up eligibility

• How wages and benefits are treated during periods of leave and reemployment

If you're a reservist or transitioning back to civilian work, we can review how this applies to your unique situation.

 

7. Can you help with tax prep or bookkeeping for our household?

Absolutely! We offer personalized tax prep and bookkeeping services tailored to military families — including MSRRA guidance, multi-state filings, and support for spouses who freelance or run a business. We also offer discounted rates as a thank-you for your service.

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