As any service member knows, military life comes with unique challenges – including unpredictable schedules and limited access to personal records. Recognizing these challenges, the IRS offers special tax filing accommodations for military personnel. Here’s what you need to know about military tax extensions and how they might benefit you.
Combat Zone Extensions
The most significant extensions are available to service members deployed to combat zones. Currently, the IRS recognizes three official combat zones:
– The Afghanistan Area (including several surrounding countries)
– The Kosovo Area
– The Arabian Peninsula
When serving in these areas, you receive an automatic extension that begins the day you leave the combat zone. This extension lasts for 180 days, plus any remaining time you had before the original deadline when you deployed. For instance, if you deployed on March 31, with the standard April 15 deadline approaching, you’d get 180 days plus those 15 days (April 1-15) – totaling 195 days.
For service members injured in combat zones, the extension clock starts ticking from your hospital release date, not your evacuation date. This extension applies to various tax-related actions, including:
– Filing tax returns
– Paying taxes owed
– Claiming refunds
– Filing claims for credits
– Making IRA contributions
– Responding to IRS collection actions or audits
Non-Combat Zone Extensions
Even if you’re not serving in a combat zone, you still have options:
Stateside Service Members
You can receive a six-month extension by filing Form 4868 before the original deadline. However, remember this crucial detail: this only extends your filing deadline, not your payment deadline. Any taxes owed must still be paid by the original due date to avoid penalties and interest.
Overseas Service Members
If you’re serving outside the United States and Puerto Rico, you automatically get a two-month extension – no paperwork required. Just attach a statement to your return explaining your overseas military service. Need more time? File Form 4868 for an additional four months.
State-Specific Extensions
Virginia Residents
Virginia offers particularly generous extensions for military personnel:
– Combat zone service: You get either the IRS extension plus 15 days OR a one-year extension, whichever is later
– Non-combat service: Automatic six-month extension with no forms required
North Carolina Residents
North Carolina aligns with IRS combat zone rules but offers some unique benefits:
– Combat zone: Follows IRS guidelines
– Overseas service: Automatic four-month extension
– Additional extension: Two more months available via Form D-410 by August 15
Remember: While filing extensions are helpful, they don’t always extend your payment deadline. Unless you’re serving in a combat zone, taxes are typically still due by the original deadline to avoid penalties and interest.
These extensions can provide valuable breathing room for service members managing their tax obligations while serving our country. Understanding and properly using these extensions can help you avoid penalties and reduce tax-related stress during your service. But keep in mind that the IRS might not know you were deployed to a combat zone! Proving your eligibility for the extension can be a tedious paperwork drill. We will do it if we need to, but whenever possible file a form 4868 so the IRS knows you are extending your filing deadline.
Additional information on federal extensions can be found in IRS Publication 3, Armed Forces’ Tax Guide, which also contains a treasure trove of tax tips for military personnel. If you are in the military and prepare your own tax returns you should read all 37 pages of that guide annually. If you’ve got a complex tax situation, or you just want someone else to take care of your tax preparation – give us a call! That’s what I do!