Tax Breaks for Veterans and Active Military Members
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If you are a veteran, you may be entitled to certain tax breaks. While veterans must pay taxes on their regular earned military and veteran pay, there are other areas that they do receive tax breaks.
If you are a military veteran, here is a look at what you need to know:
Property Tax Exemptions for Veterans
Certain veterans may be entitled to property tax exemptions. Here is a look at each exemption so that you can determine if you qualify:
Real Property Tax Exemption:
If you are a veteran you may qualify for a real property tax exemption. When you purchase property with certain funds you may be able to get a tax exemption on part of the purchase price.
Cold War Veterans Exemption:
If you are a veteran who served during the Cold War period and own residential property you may be entitled to a reduced property tax bill. You would need to check with the municipality where you live as every town, city, village, etc. has the right to choose whether or not they participate in the tax exemption.
Alternative Veterans Exemption:
If you are a Veteran that served during war time or if you are a veteran who was honored with an expeditionary medal you may also be eligible for a reduction in your property tax bill. Again, you will need to check with the municipality you live in to see if they honor the tax exemption.
It is important to note that Veterans cannot double dip when it comes to property tax exemptions. In other words, you can only claim one of the above exemptions.
Other Tax Benefits for Veterans
Veterans may also be eligible for other tax benefits including:
- Tax exemptions for job hunting including cost of creating a resume, fees charged by employment agencies and other job searching expenses.
- Free Tax Filing: Veterans may also be eligible to file their tax return for free when you file your return on the IRS website.
Tax Breaks for Active Military Members
Active military members are also entitled to a number of tax benefits. They include:
- If you are a current military member serving in a combat zone, your pay check is earned tax free.
- If you are injured on duty and as a result are hospitalized, any pay you receive during hospitalized is tax free.
- If you are an active duty military member serving overseas you can receive an extension for filing and paying your tax bill.
- As a military member you are entitled to free help in preparing and filing your tax return and can e-file for free online at the IRS website.
What Else Do You Need to Know?
If you plan to claim any military tax benefit you will need to show proof of your military status. Make sure you have your documentation ready to go.
Retired and active military may be entitled to other tax break benefits as well. If you are unsure of what tax breaks you may qualify for, your best bet is to consult with a tax preparer who specializes or is at the very least familiar with tax issues relating to active or retired military members.