Is My Military Income Taxable to Maine?

Whether your military pay is taxable to Maine depends on your residency status and duty station location.

Maine Residents

If you're a Maine resident, your active-duty military pay may or may not be taxable depending on where you're stationed.

Active-Duty Military Pay While Stationed in Maine

If you're a Maine resident and your permanent duty station is in Maine, your active-duty military income is generally taxable to Maine.

Active-Duty Military Pay While Stationed Outside Maine

Maine allows a subtraction modification for certain military pay earned by Maine residents while serving outside Maine under qualifying military orders. 

To enter this subtraction in the program:

1. State Section
2. Maine Resident Return
3. Subtractions From Income
4. Non-Maine Active Duty Military Pay

Nonresidents Stationed in Maine

If you're not a Maine resident but are stationed in Maine, your active-duty military compensation is not taxable to Maine. Maine allows nonresidents to subtract military compensation received while they were nonresidents of the state.

If active-duty military pay is your only income, you generally do not need to file a Maine return. If you have other Maine-source income, you may need to file a Maine return and exclude the military compensation from Maine taxable income.

To enter the subtraction in the program:

1. State Section
2. Maine Nonresident Return
3. Subtractions From Income
4. Non-Maine Active Duty Military Pay
5. Enter the amount of military compensation

Married Couples With Different Residency Statuses

When one spouse is a Maine resident and the other is not:

• The Maine-resident spouse may file separately using Form NRH. Schedule NRH is not supported within the program; however, you can print a copy of it from the Maine website. This is only available if you filed a married filing jointly on the federal return. 
• Alternatively, if you filed a joint federal return, you may elect to file a joint Maine return and include all income subject to Maine tax rules.

Military Retirement and Survivor Benefits

For tax years beginning on or after January 1, 2016, benefits received under a military retirement plan, including survivor benefits, are fully exempt from Maine income tax.    

To enter the Military Pension Deduction in the program:

1. State Section
2. Subtractions From Income
3. Pension Income Deduction
4. Total Eligible Military Pension Income
5. Enter the amount in the Taxpayer or Spouse field

Additional Information

• Maine Residency "Safe Harbors"
• Maine "Determining Residency Status"
• Military Spouse Relief Act