As a means to help accommodate military families, the government has the Military Tax Relief Act of 2003 which has been signed into law on November 11, 2003. Under the law, there are various items that are considered tax deductible to any military family. The website known as “ZPYJ” gives some ideas on what a military family can deduct off their yearly taxes.
The first thing, according to ZPYJ, that can be deducted are death benefits. The death gratuity benefit is paid to the survivors of the serviceman or servicewoman killed in the line of duty. At first, the benefit started out at $6,000. Since then, it has increased to $12,000. This covers any killed in a combat or qualified situation after September 10, 2001. To claim this tax deduction, you need to use red ink and write down “Military Family Tax Relief Act” on the 1040X form.
The second thing is the exclusion of tax on home sales. While the family may have lived in a house for under a minimum amount of time, there could be work reasons.
The third thing that is deductible are the travel expenses that exceed one-hundred miles. This is if the person has to travel for military drills, meetings, training exercises, camps and so forth. Also, this also expands to food, lodging, transportation expenses (gas, tickets, etc.), and so forth.
The fourth thing would be the combat zone extensions which now include contingency operations. The fifth thing is the dependent care assistance programs. The sixth thing is the military academy tax penalty.
Military.com lists other things that military families can take advantage of in regards to tax deductions. One would be your dependents which can be relatives that depend on you. The second would be medical expenses for the family provided that none of the medical expenses is for cosmetic surgery. The third would be in regards to education expenses of the family.
Also, there is flexibility if you do own your business along with employing any of your children provided that they are still minors and for certain tasks.
You can also purchase a house or condominium for your children to live in if they are going to school in another area. In this respect, you can deduct the mortgage interest and real estate taxes on your tax return. Education loans also count as well.
In today’s economy, you want to take advantage of the tax deductions you have available. Military families are by no means an exception.