According to the New York State Department of Taxation and Finance website:
- If you are a New York State resident and your permanent home was located within New York State when you entered the military, however you were assigned to duty outside of the state, you are still considered a New York State resident and your military pay will still be subject to New York State income tax to the same extent it is subject to federal income tax.
- If your permanent home was located in New York State when you entered the military, however you meet the conditions for nonresident status (of either Group A or B), your military pay is not subject to New York State income tax.
- If your permanent home was not located in New York State when you entered the military, but you were assigned duty in New York State, you are not considered a New York State resident even if you have a permanent home in the state; you are considered a nonresident and your military pay is not subject to New Your State income tax.
NOTE: If you are a nonresident and receive income from New York State sources (including your spouse's income), you may be subject to tax.
Where do I enter my nonresident subtractions?
To enter the subtraction for nonresidents or residents who are nonresidents for tax purposes, follow these steps in the program:
- State Section
- Edit New York Nonresident Return
- Subtractions from Income
- Other Subtractions
- Other Subtractions (2nd page)
- Other Subtractions (3rd page) - Description (from Drop-Down) - "Military Nonresident Pay"
- Enter the amount of the subtraction in both boxes on the page for the program to calculate the subtraction correctly
- Save
Where do I enter my military pensions?
Payments for retired military servicemembers or their beneficiaries are not taxable on the New York return. To enter the pension exclusion, follow these steps in the program:
- State Section
- New York Resident Return
- Edit
- Subtractions from Income
- Certain Pension Income is Excluded from New York taxable income
- Enter the Taxable Pensions received from New York State, Local, and Federal governments
- Save