According to the Pennsylvania Department of Revenue, "Under the new Military Spouses Residency Relief Act, income earned by the spouse of a service member shall not be considered taxable income in the state that the service member is stationed if that state is not considered the spouse's resident or domiciliary state."
To claim exempt from Pennsylvania withholding:
The nonmilitary spouse of a service member whose wages/salary is exempt from Pennsylvania personal income tax under MSRRA should file a Pennsylvania Form REV- 419 with his/her Pennsylvania employer, claiming exemption from Pennsylvania income tax withholding. Form REV-419 must be renewed each year. Reciprocal states please review instructions on form.
To claim a refund of taxes withheld from your Pennsylvania income, follow these steps in the program:
- State Section
- Nonresident Pennsylvania Return
- Adjustments to Income
- Military Pay Adjustment
- Enter the Military Spouse income as a negative (-).
Military Spouse income may be taxable on your state return where you file as a resident.