Is my military income taxable to Kentucky?

According to the Kentucky filing Instructions, all active duty military pay is exempt from Kentucky income tax.  

If you are a resident of Kentucky, enter the subtraction by performing the following steps in the program:

1. State Section
2. Edit Resident Kentucky state return
3. Subtractions From Income
4. Enter Active Duty Military Pay
5. Save 

If you are a nonresident of Kentucky, your active duty pay is not taxable on the Kentucky return.  

To exempt the nonresident military income from the nonresident return, perform the following steps in the program:

1. State Section 
2. Edit Kentucky Nonresident Return
3. Adjustments to Income
4. Nonresident Military Income
5. Complete the entry for Nonresident Military Income included in Federal AGI
6. Complete the entry for Nonresident Military income included in Kentucky AGI
7. Save 

What if my spouse and I have different residency? 

If one spouse is a resident of Kentucky and the other is a nonresident, you can choose to file Married Filing Separate on this Combined return, Married Filing Joint return, or Married Filing Separate on Separate Returns.

Additional Information

• Kentucky Income Tax Instructions
• Military Spouse Relief Act