MilSpouse State Tax Guide to Using MSRRA

frustrated-woman

The Spouse Relief Thingy  Military Spouse Residency Relief Act (MSRRA) was signed into law by the president in 2009.  Five years later, military spouses are still confused about how it works.  This post is specifically written for spouses to learn whether this law applies to you, and if so, what forms you’ll need to submit in order to claim the exemption.

MSRRA states a military spouse will neither lose nor acquire a residence for tax purposes by entering or leaving a tax jurisdiction while accompanying a service member who is moving as a result of military orders, as long as the residence is the same for husband and wife.

Last week I was contacted by a milspouse, Susan, unsure how MSRRA applied to her this tax season.  Her husband, Edward, is an active duty Marine formerly assigned to a duty station in Virginia from 2010-2013.  She taught elementary school in Virginia and her employer withheld VA taxes from her earnings.  I’ll be using their responses to the questions in the four categories below as an example to help you choose your own answers.

Determine your state of “domicile” by answering the following:

  1. In what state are you registered to vote? FL
  2. In what state are your vehicle(s) registered?  FL
  3. What state issued your driver’s license?  FL
  4. To what state do you intend to return after your service member leaves the military? FL

Determine your state of “residency” by answering the following:

  1. What state did you actually live in when you earned income?  VA
  2. Were you in that state for at least six months?  Yes

Determine your service members (SM) state of “domicile” by answering the following:

  1. What state is listed in Box 15 on the SM W-2 and/or Box 33 on the LES?  FL
  2. What state issued your SM driver’s license?  FL

Lastly, use your answers above to determine if you qualify for an exemption from income taxes in the state where your income was earned.  You must be able to answer yes to all of the following:

  1. During the tax year, was your state of residency different from your state of domicile?  Yes (FL domicile, VA residency)
  2. Did you reside in the state solely to live with your service member?  Yes
  3. Is your service member present in the state of residency due to military orders?  Yes
  4. Do you and your service member claim the same domicile?  Yes

Based on her answers, Susan discovered she is currently and was previously eligible for an exemption under the MSRRA for the entire time she worked in Virginia.  She is permitted to go back 3 tax years (2010, 2011, 2012) and amend any corrections to receive your refund.

I’ve listed every state’s filing requirement below to aid you in correctly claiming this exemption with the state where you earned income.  To make your life simpler, I highly recommend submitting a new Withholding Certificate to your employer immediately to stop state taxes from being withheld.  This certificate (links are included below for each state) is much easier to complete when compared to most state’s nonresident tax forms and will put more money in your bank account!

If you are not eligible for an exemption under the MSRRA, please contact a tax professional or base legal office for assistance with properly filing your tax returns. 

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Alabama – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (40NR) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Alabama Department of Revenue, P.O. Box 327469, Montgomery, AL 36132-7469

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Exemption Certification Form, Form A-4.

Alaska – No State Tax

Arizona – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (140NR) to report state taxes withheld and receive a refund. You may e-file current year returns, but will need to mail prior year amended returns to: Arizona Department of Revenue, P.O. Box 52138, Phoenix, AZ  85072-2138

To prevent future state tax withholdings, give your employer a completed Withholding Exemption Certificate for Military Spouses (you must include a copy of latest LES and a copy of military dependant ID), Form WECM.

Arkansas – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (AR1000NR) and write “Military Spouse” on top of the front page of the return to report state taxes withheld and receive a refund. Also, attach Certificate AR-MS to return. Add any additional documentation such as LES or a copy of military dependent ID to help in the processing of the return.  Mail your current and prior year amended returns to: Arkansas State Income Tax, P.O. Box 1000, Little Rock, AR 72203-1000

To prevent future state tax withholdings, give your employer a completed Annual Withholding Tax Exemption Certification For Military Spouse, Form ARW-4MS.

California – If both the military member and spouse are NOT residents, you must file a married filing joint nonresident return (CA540NR with Schedule CA) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Franchise Tax Board, P.O. Box 942840, Sacramento, CA  94240-0000

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Allowance Certification, Form DE 4.

Colorado – If both the military member and spouse are NOT residents, you must file a married filing joint nonresident return (104 with 104PN attached) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: State of Colorado, Colorado Department of Revenue, Denver, CO  80261-0005

To prevent future state tax withholdings, give your employer a completed Exemption from Withholding for a Qualifying Spouse of a U.S. Armed Forces Service Member, Form DR 1059.

Connecticut – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (CT-1040NR/PY) and write “Military Spouse” on top of the front page of the return to report state taxes withheld and receive a refund.  You must also attach a signed letter stating you are eligible to claim the MSRRA exemption and are electing to do so, a LES, and a copy of your military dependent ID.  Mail your current and prior year amended returns to: CT Department of Revenue Services, P.O. Box 2968, Hartford, CT  06104-2968

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Certification, Form CT-W4.

Delaware – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (200-02) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: State of Delaware
, Division of Revenue, P.O. Box 8772
, Wilmington, DE  19899-8772

To prevent future state tax withholdings, give your employer a completed Annual Withholding Tax Exemption Certification Form, Form W-4DE.

Florida  No State Tax

Georgia – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (GA 500) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Georgia Income Tax Division, P.O. Box 740380, Atlanta, GA  30374-0380

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Allowance Certification, Form G-4.

Hawaii – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (N-15) and write “MSRRA” at the top of the front page of the return to report state taxes withheld and receive a refund.  You must also attach a copy of the service members orders assigning them to Hawaii, a LES, and a copy of your military dependent ID.  Mail your current and prior year amended returns to: Hawaii Department of Taxation, P.O. Box 3559, Honolulu, HI  96811-3559

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Allowance and Status Certificate, Form HW-4 and Employees Statement to Employer Concerning Nonresidence in the State of Hawaii, Form HW-6.

Idaho – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (ID 43) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Idaho State Tax Commission, P.O. Box 56, Boise, ID 83756-0056

To prevent future state tax withholdings, give your employer a completed Employee’s Idaho Military Spouse Withholding Exemption Certificate,  Form ID-MS1.

Illinois – If both the military member and spouse are NOT residents, file a married filing separate nonresident return (IL-1040 and Sch NR) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Illinois Department of Revenue, Springfield, IL  62719-0001

To prevent future state tax withholdings, give your employer a completed Employees Statement of Nonresidence in Illinois, Form IL-W-5-NR.

Indiana – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (IT-40PNR with Schedules A & D) and enclose a completed Schedule IN-2058SP to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Indiana Department of Revenue, P.O. Box 40, Indianapolis, IN  46206-0040

To prevent future state tax withholdings, give your employer a completed Annual Nonresident Military Spouse Earned Income Withholding Tax Exemption Form, Form WH-4MIL.

Iowa – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (IA 1040) but show no Iowa wages on line 1 of the IA 126 to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Iowa Income Tax, Refund Processing, Department of Revenue and Finance, Hoover State Office Building, Des Moines, IA 50319-0120

To prevent future state tax withholdings, give your employer a completed Employees Statement of Nonresidence in Illinois, Form IA W4.

Kansas – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (KS-40) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Kansas Income Tax, Kansas Department of Revenue, 915 SW Harrison St, Topeka, KS  66699-1000

To prevent future state tax withholdings, give your employer a completed Employees Withholding Allowance Certificate, Form K-4.

Kentucky – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (740-NP) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Kentucky Revenue Cabinet, Frankfort, KY 40618-0006

To prevent future state tax withholdings, give your employer a completed Nonresident Military Spouse Withholding Tax Exemption Certificate, Form K-4M.

Louisiana – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (IT-540B) and write “MILITARY SPOUSE” at the top of the front page of the return to report state taxes withheld and receive a refund.  You must also attach a copy of the service members orders assigning them to Louisiana, a LES, a copy of your military dependent ID, and Form DD 2058.  Mail your current and prior year amended returns to: Department of Revenue, P.O. Box 3440, Baton Rouge, LA  70823-3440

To prevent future state tax withholdings, give your employer a completed Exemption from Withholding Louisiana Income Tax, Form L-4E.

Maine – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (1040ME with Schedule NR) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Maine Revenue Services, P.O. Box 9111, Augusta, ME  04332-9111

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Allowance Certificate, Form W-4ME.

Maryland – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (502) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Comptroller of the Treasury, Revenue Administration Division, Annapolis, MD  21411-0001

To prevent future state tax withholdings, give your employer a completed Employee’s Maryland Withholding Exemption Certificate, Form MW507 and Exemption from Maryland Withholding Tax for a Qualified Civilian Spouse of a U.S. Armed Forces Service Member, Form MW507M.

Massachusetts – If both the military member and spouse are NOT residents, file a married filing joint  or married filing separate nonresident return (1-NR/PY) and write “MSRRA” at the top of the front page of the return to report state taxes withheld and receive a refund.  You must also attach a copy of the service members orders assigning them to Massachusetts, a LES, a copy of your military dependent ID, and Form DD 2058.  Mail your current and prior year amended returns to: Massachusetts Department of Revenue, P.O. Box 7054, Boston, MA  02204

To prevent future state tax withholdings, give your employer a completed Annual Withholding Tax Exemption Certificate for Military Spouse, Form M-4-MS.

Michigan – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (MI-1040 with Schedule NR) and write “MSRRA” at the top of the front page of the return to report state taxes withheld and receive a refund.  You must also attach a copy of the service members orders assigning them to Massachusetts, a LES, a copy of your military dependent ID, and Form DD 2058.  Mail your current and prior year amended returns to: Michigan Department of Treasury, Lansing, MI  48956

To prevent future state tax withholdings, give your employer a completed Employee’s Michigan Withholding Exemption Certificate, Form MI-W4.

Minnesota – If both the military member and spouse are NOT residents, use the same filing status as your federal return and complete a nonresident return (M-1 with Schedule M-1NR) to report state taxes withheld and receive a refund.  You must also attach a copy of the service members orders assigning them to Minnesota, a LES, a copy of your military dependent ID, and Form DD 2058.  Mail your current and prior year amended returns to: Minnesota Individual Income Tax, St. Paul, MN  55145-0010

To prevent future state tax withholdings, give your employer a completed Employee’s Michigan Withholding Exemption Certificate, Form MI-W4.

Mississippi – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (80-205) to report state taxes withheld and receive a refund.  You must also attach a copy of the service members driver’s license, a copy of your military dependent ID, and Form DD 2058.  Mail your current and prior year amended returns to: Mississippi Tax Commission, Individual Income Tax Division, P.O. Box 1033, Jackson, MS  39215-1033

To prevent future state tax withholdings, give your employer a completed Mississippi Employee’s Withholding Exemption Certificate, Form 89-350.

Missouri – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (MO 1040 and MO-A) to report state taxes withheld and receive a refund.  You must also attach any of the following to prove you are a resident of another state – home state tax return filed, valid driver’s license, vehicle registration, voter ID.  Mail your current and prior year amended returns to: Department of Revenue, P.O. Box 500, Jefferson City, MO  65106-0500

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Allowance Certificate, Form MO W-4.

Montana – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (MT 2) to report state taxes withheld and receive a refund.   You must also attach a copy of the service members LES and copy of your military dependent ID.  Mail your current and prior year amended returns to: Department of Revenue, P.O. Box 6577, Helena MT  59604-6577

To prevent future state tax withholdings, give your employer a completed Employee Certificate of Status Under the Military Spouses Residency Relief Act, Form MSR.

Nebraska – If both the military member and spouse are NOT residents, file a married filing separate nonresident return (1040N with Sch III) and write “Exempt Nonresident Military Spouse” on line 66 of Schedule III to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Nebraska Department of Revenue, P.O. Box 98912, Lincoln, NE  68509-8912

To prevent future state tax withholdings, give your employer a completed Nebraska Nonresident Employee Certificate, Form 9N.

Nevada – No State Tax

New Hampshire  No State Tax

New Jersey – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (NJ-1040NR) and write “MILITARY SPOUSE” at the top of the front page of the return to report state taxes withheld and receive a refund.   You must also attach a copy of the your military dependent ID.  Mail your current and prior year amended returns to: Division of Taxation
, Revenue Processing Center
, P.O. Box 244, 
Trenton, NJ  08646-0244

To prevent future state tax withholdings, give your employer a completed Employee’s Certificate of Nonresidence in New Jersey, Form NJ-165.

New Mexico – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (PIT-1 with PIT-B) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Taxation and Revenue Department, P.O. Box 25122, Santa Fe, NM  87504-5122

To prevent future state tax withholdings, give your employer a completed Military Spouse Withholding Tax Exemption Statement, Form RPD-41348.

New York – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (IT-203) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: State Processing Center, P.O. Box 61000, Albany, NY  12261-0001

To prevent future state tax withholdings, give your employer a completed Certificate of Exemption from Withholding, Form IT-2104.

North Carolina – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (D-400) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: NC Department of Revenue, P.O. Box R, Raleigh, NC  27634-0001

To prevent future state tax withholdings, give your employer a completed Employee’s Withholding Allowance Certificate, Form NC-4.

North Dakota – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (ND-1 with Schedule NR) to report state taxes withheld and receive a refund.  Please note, self employment income IS NOT exempt and you must pay taxes on that amount.  You may e-file current year returns, but will need to mail prior year amended returns to: Office of State Tax Commissioner, State Capitol 600 E. Boulevard Ave, Dept 127, Bismarck, ND  58505-0550

To prevent future state tax withholdings, give your employer a completed Exemption from Withholding Tax for a Qualifying Spouse of a U.S. Armed Forces Service Member, Form NDW-M.

Ohio – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (IT-1040) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Ohio Department of Taxation, P.O. Box 2679, Columbus, OH  43218-2679

To prevent future state tax withholdings, give your employer a completed Exemption from Withholding-Military Spouse Employee, Form IT MIL-SP.

Oklahoma – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (511NR) to report state taxes withheld and receive a refund.  You must also attach a copy of the service member’s military W-2 and LES, spouse’s W-2, and copies of your federal income tax return as well as your resident state’s return in order to avoid processing delays.  Mail your current and prior year amended returns to: Oklahoma Tax Commission, Income Tax, P.O. Box 26800, Oklahoma City, OK  73126-0800

To prevent future state tax withholdings, give your employer a completed Annual Withholding Tax Exemption Certificate for Military Spouse, Form OW-9-MSE.

Oregon – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (40N) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Oregon Department of Revenue, P.O. Box 14700, Salem, OR  97309-0930

To prevent future state tax withholdings, give your employer a completed Federal Employee’s Withholding Allowance Certificate, Form W-4 and write “Nonresident Military Spouse For State Purposes Only” across the top.

Pennsylvania – If both the military member and spouse are NOT residents, file a married filing joint or married filing separate nonresident return (PA-40 with Schedule NRH) to report state taxes withheld and receive a refund.  If you e-file your current year return, you must fax them the following documents with the taxpayer’s name and SSN written on each – a copy of the service member’s current military orders showing the order to serve in Pennsylvania; a copy of the service member’s military ID; a copy of the spouse’s driver’s license from the resident state; a copy of the spouse’s W-2, issued by the employer; a copy of the spouse’s tax return filed with the resident state; a copy of the spouse’s military ID card, identifying the card-holder as the spouse; and a copy of the service member’s DD Form 2058, State of Legal Residence Certificate.  Fax #: 717-772-4193  Paper filed current year and prior year amended returns should have “MSRRA” written at the top of the front page of the return, and include the list of supporting documents mentioned above.  Mail them to: PA Department of Revenue, REFUND/CREDIT Requested, 3 Revenue Place, Harrisburg, PA  17129-0003

To prevent future state tax withholdings, give your employer a completed Employee’s Nonwithholding Application Certificate, Form REV-419.

Rhode Island – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (RI-1040NR) to report state taxes withheld and receive a refund.  Please note, self employment income IS NOT exempt and you must pay taxes on that amount.  You may e-file current year returns, but will need to mail prior year amended returns to: R.I. Division of Taxation, One Capitol Hill, Providence, RI  02908-5806

To prevent future state tax withholdings, give your employer a completed State of Rhode Island and Providence Plantations Employee’s Withholding Allowance Certificate, Form RI W-4.

South Carolina – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (SC1040 with Schedule NR) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Processing Center, P.O. Box 101100, Columbia, SC  29211-0100

To prevent future state tax withholdings, give your employer a completed Federal Employee’s Withholding Allowance Certificate, Form W-4 and write “Nonresident Military Spouse For State Purposes Only” across the top.

South Dakota – No State Tax

Tennessee  No State Tax

Texas  No State Tax

Utah – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (TC-40) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Utah State Tax Commission, 210 N 1950 W, Salt Lake City, UT  84134

To prevent future state tax withholdings, give your employer a completed Federal Employee’s Withholding Allowance Certificate, Form W-4 and write “Nonresident Military Spouse For State Purposes Only” across the top.

Vermont – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (IN-111 plus IN-113) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Department of Taxes, P.O. Box 1881, Montpelier, VT  05601-1881

To prevent future state tax withholdings, give your employer a completed Vermont Employee’s Withholding Allowance Certificate, Form W-4VT.

Virginia – If both the military member and spouse are NOT residents, file Form VA 763-S to report state taxes withheld and receive a refund.  You must include the following – a copy of spouse’s military ID; a copy of spouse’s resident state’s tax return (if resident state taxes income); a copy of all W-2(s); copy of service members LES; spouse’s current driver’s license from resident state; service members current driver’s license from resident state or DD Form 2058 (State of Legal Residence Certificate).  Mail current and prior year amended returns to: Department of Taxation, P.O. Box 1498, Richmond, VA  23218-1498

To prevent future state tax withholdings, give your employer a completed Commonwealth of Virginia Department of Taxation Personal Exemption Worksheet, Form VA-4.

Washington D.C. – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (D-40 with D-40B attached) to report state taxes withheld and receive a refund.  Mail your current year and prior year amended returns to: Office of Tax and Revenue, Benjamin Franklin Station, P.O. Box 7861, Washington, D.C.  20044-7861

To prevent future state tax withholdings, give your employer a completed Employee Withholding Allowance Certificate, Form D-4.

Washington  No State Tax

West Virginia – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (IT-140 and Sch M) and write “Nonresident Military Spouse” at the top of the front page of the return to report state taxes withheld and receive a refund.  Please note, self employment income IS NOT exempt and you must pay taxes on that amount.  Attach a copy of DD 2058 and mail your current year and prior year amended returns to: Department of Tax and Revenue, Taxpayer Services Division, P.O. Box 3784, Charleston, WV 25337-3784

To prevent future state tax withholdings, give your employer a completed West Virginia Employee’s Withholding Allowance Certificate, Form WV/IT-104.

Wisconsin – If both the military member and spouse are NOT residents, file a married filing joint nonresident return (1NPR) to report state taxes withheld and receive a refund.  You may e-file current year returns, but will need to mail prior year amended returns to: Wisconsin Department of Revenue, P.O. Box 59, Madison, WI  53785-0001

To prevent future state tax withholdings, give your employer a completed Nonresident Military Spouse Withholding Exemption, Form W-221.

Wyoming  No State Tax

As state requirements change, I appreciate your feedback to help keep this information up-to-date!

*Updated March 4, 2016*

3 thoughts on “MilSpouse State Tax Guide to Using MSRRA

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