According to the Massachusetts website, " Under the MSRRA, a spouse of a service member may be exempt from Massachusetts personal income tax on income from services performed in MA by the spouse if all of the following are applicable:
- the service member must have declared "legal residence for purposes of withholding state income taxes from military pay" in a state other than Massachusetts;
- the service member is present in or near Massachusetts in compliance with military orders;
- the spouse is in Massachusetts solely to be with the service member
- the spouse is domiciled in the same state as the service member."
Beginning January 5, 2023, under the Veterans Auto and Education Improvement Act, a servicemember and spouse may choose their residence or domicile, from the options listed below, for each tax year of marriage, regardless of date of marriage.
- The residence or domicile of the servicemember
- The residence or domicile of the spouse.
- The permanent duty station of the servicemember.
Please refer to TIR 19-15 Taxation of the Income of Military Servicemembers and their Spouses.
To claim tax-exempt from Massachusetts withholdings:
The qualifying servicemember's spouse (if qualified) may claim an exemption from Massachusetts withholding tax. The spouse must complete Form M-4 MS to claim exempt status. Additional information may be required to prove exempt status. The form must be validated annually.
How do I claim a refund for my Massachusetts withholdings?
To claim a refund of taxes withheld from your Massachusetts income, take the following path in your account:
- State
- MA Nonresident Return
- Deductions
- Enter income excludible under MGL Ch. 41, sec 111F and/or Military spouse's nonresident income - enter military spouse income not subject to MA tax.
Print and sign the return and write "MSRRA" across the top of Form 1-NR/PY, Massachusetts requires the Form 1 NR/PY return to be paper filed; no e-file returns are allowed. Include copies of the following with the return:
- Military Spouse ID Card
- Department of Defense Form 2058, State of Legal Residence Certificate – "legal residence for purposes of withholding state income taxes from military pay;"
- Leave and Earnings Statement of service member
- Service member's current military orders assigning such service member to a post of duty in or near Massachusetts.
Military Spouse income may be taxable on your state return where you file as a resident.