Combat Pay Counts for Stimulus Payment

Week of March 31, 2008

Military personnel serving or in combat zones are eligible for an economic stimulus payment. While combat pay generally is nontaxable, servicemembers are permitted to count this pay on their 2007 or 2008 income tax returns, if it helps their eligibility. Servicemembers should report their nontaxable combat pay on Line 40b of the Form 1040A to show at least $3,000 in qualifying income. Spouses or others with a power of attorney can prepare and file a 2007 income tax return on behalf of servicemembers so that the stimulus payment is received this year. The return must be filed by Oct. 15. 2008. For more information call 1-800-TAX-1040.

Read the full article on Military.com.