Military Income Deduction Information
Section 143.174, RSMo provides a deduction for military income earned as a member of the active duty component of the Armed Forces of the United States. Below is some helpful information regarding the military deduction:
- This deduction may be claimed on the Military Income Deduction line of the Missouri Individual Income Tax Return (Form MO-1040). The 2016 return (line 19) is the first year this deduction may be claimed.
- The military income must be included in the federal adjusted gross income and not have been previously taken as a deduction or subtraction.
- When submitting your return, include a copy of your Leave and Earnings Statement(s) that validate how long you were on active duty for training or annual training and the amount you earned on active duty for training or on annual training. Failure to attach the required documentation may result in the disallowance of the deduction. A PDF of this documentation should be provided when filing your return electronically.
- The military income deduction is available for the amount of pay received while: (REVISED – NOVEMBER 2017)
- Ordered to federal active duty status under 10 USC or 32 USC
- Participating in Annual Training (typically 2 weeks a year)
- Participating in other active training or schools, except for Inactive Duty for Training, which does NOT qualify for this deduction.
- You may NOT take the deduction for the amount of pay you received while on:
- State Active Duty (shown on your state W-2 form)
- Inactive Duty Training - While this may appear on a Leave and Earnings Statement, Inactive Duty for Training does not qualify for the military income deduction.
- All Missouri returns claiming the military deduction will be compared to income data (Form W-2 data) provided by the Defense Finance and Accounting Service (DFAS).