According to the West Virginia Income Tax Instructions, military income is taxable in West Virginia for residents physically present in the state for more than 30 days, but there are significant exemptions and conditions.
West Virginia Residents: If you are a resident present in the state for more than 30 days during the year, your active duty pay is generally taxed. You are required to report all of your income regardless of where it was earned or source of income.
Exemption for Residents:
If you are a separated from active duty service, you are able to deduct your active duty military pay. You must include a copy of your military orders, DD 214, and W-2 with your return when filed.
To enter the subtraction into the account, follow these steps in the program:
- State Section
- Edit Resident West Virginia Return
- Subtractions From Income
- Active Military Separation
- Enter amount for taxpayer or spouse
- Continue
If you are a resident of West Virginia that was not present in the state for 30 days or more, you will need to file a nonresident return. The active duty pay will not be taxable on the nonresident return. However, you must still include a copy of your military orders when the return is filed.
To enter a subtraction for the Active Duty pay, follow these steps in the program:
- State Section
- Edit West Virginia Nonresident State Return
- Subtractions From Income
- Active Duty Military Pay
- Enter amount in appropriate box
- Continue
Nonresident Service Members: If you are a nonresident of West Virginia stationed in the state, your active duty pay is not taxable to West Virginia.
To enter a subtraction, follow these steps in the program:
- State Section
- Edit West Virginia Nonresident Return
- Subtractions From Income
- Active Duty Military Pay
- Enter amount in appropriate box
- Continue
If one spouse is a resident and the other is not, file Married Filing Separate returns.
National Guard or Reserve Pay:
Military pay received while you were a National Guard or Armed Forces Reserve member called to duty, is not taxable on your return. A copy of your military orders must accompany the return. At this time, you must print, sign and mail the return to include the military orders.
To enter the subtraction into the return, follow these steps in the program:
- State Section
- Edit West Virginia Resident Return
- Subtractions From Income
- Active Duty Military Pay
- Enter amount for taxpayer or spouse
- Save
Certain State and Federal Retirement Systems:
You may subtract up to $2,000 for pensions and annuities received from the West Virginia Public Employees' Retirement System, the West Virginia Teachers' Retirement System Military Retirement or Federal Retirement.
To enter the subtraction from within your account, follow these steps in the program:
- State Section
- Edit West Virginia Return
- Subtractions from Income
- Taxable Teachers and Federal Retirement
- Do not enter more than $2000
- Continue
Additional Military Retirement:
The additional modification of military retirement income no longer has a maximum amount to the extent it is included in federal adjusted gross income.
To enter the subtraction from within your account, follow these steps in the program:
- State Section
- West Virginia Resident Return
- Subtractions from Income
- Enter eligible Military Retirement Modification
- Enter amount
- Continue