Is My Military Income Taxable to West Virginia?

Whether your military pay is taxable to West Virginia depends on your residency status, military status, and the type of military income you received.

West Virginia Residents

If you are a West Virginia resident, you generally must report all income on your West Virginia return, regardless of where it was earned. This includes military pay unless a specific subtraction applies. 

Active Military Separation

If you were a West Virginia resident, served on active duty for at least 30 continuous days, and completely separated from military service during the tax year, you may subtract eligible active duty military pay from your West Virginia income. The subtraction is limited to active duty pay included in your federal adjusted gross income. You must include copies of your military orders, DD Form 214, and Form W-2 with your return.

To enter this subtraction in the program:

1. State Section
2. Select the 3 dots for Edit 
3. Subtractions From Income
4. Active Military Separation
5. Enter the amount for the taxpayer or spouse
6. Continue

West Virginia Residents Who Qualify as Nonresidents

A West Virginia resident who spends fewer than 30 days in West Virginia during the year and maintains a permanent residence outside the state may qualify as a full-year nonresident. In that situation, active duty military pay is generally not taxable by West Virginia on the nonresident return. Military orders should be included when filing.

To enter the subtraction:

1. State Section
2. Select the 3 dots for Edit 
3. Subtractions From Income
4. Active Duty Military Pay
5. Enter the amount in the appropriate box
6. Continue

Nonresident Service Members Stationed in West Virginia

Under the federal Servicemembers Civil Relief Act (SCRA), military compensation is taxable only by the state elected as the service member's residence for tax purposes. If your domicile is outside West Virginia and you are stationed in West Virginia under military orders, your active duty military pay is not taxable to West Virginia. 

If West Virginia tax was withheld from your pay, you may need to file a West Virginia nonresident return to claim a refund. Include a copy of DD Form 2058 showing your state of legal residence. 

To enter the subtraction:

1. State Section
2. Select the 3 dots for Edit 
3. Subtractions From Income
4. Active Duty Military Pay
5. Enter the amount in the appropriate box
6. Continue

Military Spouses

Under SCRA, a military spouse may elect the same state of residence as the service member. If the spouse is not domiciled in West Virginia and earns income while accompanying the service member, that income generally is not subject to West Virginia income tax. If West Virginia tax was withheld, the spouse can file a nonresident return and include DD Form 2058 to request a refund.

If one spouse is a West Virginia resident and the other is not, separate state returns may be required depending on the circumstances. 

National Guard and Reserve Pay

West Virginia allows a subtraction for certain military income received while serving in the National Guard or Armed Forces Reserves when called to active duty in support of a qualifying contingency operation, including operations such as Operation Enduring Freedom, Operation Iraqi Freedom, Operation New Dawn, Operation Inherent Resolve, and other qualifying Overseas Contingency Operations. Military orders and Form W-2 must be included with the return. 

To enter the subtraction:

1. State Section
2. Select the 3 dots for Edit 
3. Subtractions From Income
4. Active Duty Military Pay
5. Enter the amount for the taxpayer or spouse
6. Save

Military Retirement Income

Military retirement income, including survivorship annuities, is fully exempt from West Virginia income tax to the extent it is included in federal adjusted gross income. Unlike some other retirement income modifications, there is no dollar limit on the military retirement subtraction. 

To enter the subtraction:

1. State Section
2. Select the 3 dots for Edit 
3. Subtractions From Income
4. Military Retirement Modification
5. Enter the eligible amount
6. Continue

Additional information