Non-taxable Income for Those in the Armed Services
One of the benefits available to the men and women of our Armed Services and, in many cases, staff supporting them is the ability to exclude items from taxable income. Here is a list of the most common items that may often be omitted from income tax.
Excluded Items | |
Combat zone pay | Compensation for active service while in a combat zone Note: Limited amount for officers |
Other pay | Defense counseling Disability, including payments received for injuries incurred as a direct result of a terrorist or military action Group-term life insurance Professional education ROTC educational and subsistence allowances State bonus pay for service in a combat zone Survivor and retirement protection plan premiums Uniform allowances Uniforms furnished to enlisted personnel |
Death allowances | Burial services Death gratuity payments to eligible survivors Travel of dependents to burial site |
Family allowances | Certain educational expenses for dependents Emergencies Evacuation to a place of safety Separation |
Living allowances | BAH (Basic Allowance for Housing) BAS (Basic Allowance for Subsistence) Housing and cost-of-living allowances abroad paid by the U.S. Government or by a foreign government OHA (Overseas Housing Allowance) |
Moving allowances | Dislocation Military base realignment and closure benefit (the exclusion is limited as described above) Move-in housing Moving household and personal items Moving trailers or mobile homes Storage Temporary lodging and temporary lodging expenses |
Travel allowances | Annual round trip for dependent students Leave between consecutive overseas tours Reassignment in a dependent restricted status Transportation for you or your dependents during ship overhaul or inactivation Per diem |
In-kind military benefits | Dependent-care assistance program Legal assistance Medical/dental care Commissary/exchange discounts Space-available travel on government aircraft |
Note: The exclusion for certain items applies whether the item is furnished in kind or is a reimbursement or allowance. There is no exclusion for the personal use of a government-provided vehicle.