Revenues of US military personnel, as well as other US citizens, are subject to state and federal taxes. When serving outside the US, military personnel have additional rights to a number of social tax deductions, but the procedure and mechanism of taxation itself remains the same.
In accordance with federal laws, the following components of the total income of a serviceman are subject to taxation:
– the basic monetary allowance (including during the studies in military schools and during the training in reserve components);
– supplements to the monetary content (for special conditions of service in the Air Force and Navy, for service in conditions associated with an increased risk to life, for knowledge of foreign languages);
– special payments (for service in positions related to special responsibility, to specialists in the maintenance of nuclear facilities, equalizing and qualifying military doctors, encouraging the sergeant and ordinary staff for their class and special duties);
– various types of remuneration (for impeccable service, for rationalization proposals, inventions);
– awards (on the basis of studies, competitions);
– lifting benefits (in case of extension or re-conclusion of the contract, when moving to a new duty station);
– compensation (for overtime work time, for temporary disability);
– severance pay for dismissal due to illness or without the right to receive a pension;
– personal payments to officers with the highest military ranks of the US Armed Forces;
– personal income from deposits, real estate sales, etc.
Along with this, military personnel have the right not to include in the amount of taxable income the following payments and allowances:
– compensation for living expenses (housing, utilities);
– temporary apartment surcharge (compensation for rent differences in various parts of the United States, as well as while serving abroad);
– allowance for the maintenance of the family (payments to study and medical support of financially dependent dependents);
– payments to cover expenses when moving to a new duty station (payment of family members’ travel, baggage transportation, transportation of personal belongings);
– Payment of travel of a soldier and his family members to the place of annual and short-term vacations and back;
– supplement to the monetary support for living in isolation from the family;
– reimbursement of expenses related to the loss of a relative of a serviceman (no more than 3 thousand dollars, including payment of funeral services and travel of relatives to the place of burial);
– profit from using the system of discounts in the network of military stores;
– the allowance of reserve officers in training at the refresher courses;
– mark-up on high cost (when placed outside the US);
– payments for the purchase of uniforms and items of military uniform;
– Fees for legal assistance.
During the period of service in the combat zones, the US military also has the additional right to deduct the following types of cash allowance from the taxable total income:
– cash for one month of service in the combat zone;
– supplement to the monetary content for serving in conditions associated with danger to life;
– lifting allowance for the voluntary extension or re-contract;
– compensation for unused vacation;
– additional fee (for one month) for service in the freelance units (clubs, canteens, post office, church);
– monetary reward for the rationalization proposal or invention.
An important element of the system of preferential taxation is the right of military personnel to a single tax deduction. The size of this deduction is about 3.1 thousand US dollars (258.3 dollars per month) for each family member.
To determine the amount of the monthly tax, a soldier must deduct the corresponding amount of tax deduction from the amount of taxable income.
In addition, US soldiers are entitled to various types of general civil tax credits aimed at reducing the amount of taxable income. The amount of tax credit is determined depending on the total annual income, the number, age and position of children.
Along with federal tax, military income is taxed by the state, which is their permanent place of employment and residence. In the states of Alaska, Nevada, South Dakota, Texas, Washington and Wyoming, military personnel are exempt from state tax completely, in other states they are usually exempted from paying taxes on various types of income. The procedure and mechanism of taxation are determined by local law.
As a rule, the tax return is sent to the local federal tax service offices no later than April 15 of each year. Military personnel serving outside the United States have the right to postpone the filing of the declaration until June 15. When filling out a tax return, a soldier is obliged to indicate all types of his income, including non-taxable ones, and also to substantiate in detail his right to provide him with a tax credit.
The existing US state life insurance program for military personnel of the armed forces was enacted in 1965 by federal law PL 89-214. Responsibility for the implementation of the program was assigned to the Ministry of Veterans Affairs. Initially, the program provided life insurance for only regular servicemen, and later, as a result of a series of phased changes, reserve and national guard servicemen, as well as students of higher military educational institutions, were included in the program.
The amount of insurance since the approval of the program has increased from 10 thousand to 250 thousand dollars. Life insurance of a soldier for the entire sum insured enters into force automatically from the moment of his transfer to the US Armed Forces and is valid for the entire service life and 120 days after dismissal, except in the case of complete disability, in which insurance is valid until it is restored. The size of the monthly insurance premium is $ 16.5 and is automatically deducted from the monetary allowance of the serviceman.
Life insurance for veterans is based on eight government programs: the US government program, the national military program, a special program for veterans, a program for disabled people, a new program for veterans, a group program for military personnel, a program for mortgages for veterans, a group program for veterans. In this case, insurance is carried out in the amount of 10 thousand to 250 thousand dollars. For disabled people with complete disability, the possibility of additional insurance in the amount of up to 20 thousand dollars is provided. The group program for veterans provides for insurance of persons dismissed from active military service for a five-year period in the amount of up to $ 250,000. The term of the insurance contract is five years.
In accordance with US law, American citizens who have served no less than the term set for a recruit training course (180 days or more) and who were not dismissed due to misbehavior on active military service fall under the category of “veteran” and become eligible for certain benefits. For those laid off due to disability, the minimum terms of service are not established.
The Department of Veterans Affairs deals with the benefits and privileges of veterans of the US military.
Currently, there are more than 27 million people dismissed from military service in the United States and 46 million members of their families, who to one degree or another are eligible for benefits.
The main benefits provided by US laws for veterans of the US Armed Forces include: disability benefits; implementation of a vocational rehabilitation program; assistance in obtaining education; psychotherapeutic assistance to war veterans; assistance in employment; unemployment benefits; concessional medical care, life insurance, housing loans, funerals, and some other services.
Monthly disability benefits are paid to veterans with disability from 10 percent or more. provided that the disability is the result of illness or injury in the performance of official duties. Currently, the amount of the allowance is from 106 to 2,239 dollars.
In addition, in addition to these benefits, there are additional payments in the amount of $ 2,506 to $ 3,707, which are appointed when the veteran has certain injuries. For example, in case of total disability, when there is an additional disability in addition to the main one, obtained during military service, the degree of which is estimated at no less than 60 percent, or if the veteran is completely deprived of the ability to move independently, the payment is $ 2,506.
If dependent disabled veterans with disability 30 percent. and there are more family members, they are also paid additional compensation from $ 65 to $ 349 (depending on the number of dependents and the degree of disability).
Special monthly paid pensions are established for a number of categories of disabled veterans, whose disability is not related to the performance of official duties. These include participants in the First and Second World Wars, the wars in Korea, Vietnam, and other military conflicts. Pensions, depending on family composition, the number of dependents, the degree of mobility and autonomy of a disabled person, can range from $ 9,690 to $ 19,167 per year. Benefits and pensions are paid from the budget of the Ministry of Veterans Affairs.
The program of vocational rehabilitation is carried out with the aim of assisting veterans who have become disabled as a result of undergoing active military service, restoring their independence, social and professional fitness. The program covers former military personnel with a degree of disability of at least 20 percent.
The rehabilitation course is designed for 48 months or more. It is organized on the basis of universities, colleges, schools and vocational training courses, specialized rehabilitation institutions, and, if necessary, at home. The program of the course provides: free education in the specialty; free special classes related to the restoration of motor, speech and other functions that ensure daily independence, and are organized depending on the nature of the disability (lack of limbs, blindness, deafness, etc.); the provision of free services, including the provision of food, medical care and prosthetics for public transport, domestic services for families of veterans and some others.
The rehabilitation course can be completed at any time convenient for a veteran during a 12-year period from the moment he was appointed by the Ministry of Veterans Affairs for a disability pension.
The Department of Defense, the Department of Veterans Affairs, the federal and local governments of the United States implement in practice a wide package of programs providing material support to families and relatives of military personnel who died or were injured in the performance of their duties, during hostilities and in other conditions associated with risk. for life.
Payments and compensations (lump-sum cash benefits, property tax cuts, tuition fees, medical support, and others) under these programs are made from the federal budget at the request of the state social security agencies, and in some cases from the state budgets where the soldier’s family lives . In this case, benefits and benefits established in accordance with federal and state laws are provided in parallel. The amount of monetary compensation for the death or injury of the breadwinner is the highest in the world and, according to US federal authorities, it provides the necessary financial support for the next of kin.
Benefits may be paid to family members of military personnel who died or died while on duty, or to veterans whose death was caused by disability obtained during military service.
The benefits for families of veterans are: –
for widows who have not remarried (depending on the title of the deceased or deceased) – from 967 to 2,213 dollars per month;
– For children under the age of 18 (or up to 23 if they are single and attend educational institutions as provided for in the list of the Ministry of Veterans Affairs), widows are paid $ 241 per month per child.
For widows (widowers) of veterans, a single amount of benefit was established regardless of the title of the deceased – $ 967 a month, if the veteran was completely disabled for at least the last eight years (the disability was received during their service), then an additional payment is paid to the widow (widower). The amount of 208 dollars.
In the event of the death of soldiers or their disability as a result of hostilities or in case of death during service (provided that the service has been flawless for the last two years), pensions can be granted to dependent family members. Pensions depend on family composition, the physical condition of the widow (widower) and the number of children remaining on her (his) dependency and range from $ 6,634 to $ 12,657 per year. Additionally, $ 1,688 is paid for each child in excess of one.
Along with this, the Ministry of Defense lumps out to the families of all those who died or died within 120 days after the end of the service the so-called posthumous reward in the amount of 12 thousand dollars. Every soldier who was killed in the line of duty (and later his / her spouse) is entitled to a free burial at Arlington Memorial Cemetery (Arlington, Virginia) with military honors and funeral services.
If the remaining spouse needs long-term or permanent treatment and hiring a nurse for health reasons, she / he will be paid a monthly allowance of $ 229 to partially compensate for these costs. In addition, family members of the deceased soldier enjoy discounts on the purchase of drugs, while this privilege is retained for the remaining spouse after 55 years, even with remarriage.
The state administration also provides for various payments and benefits. Thus, in the state of Alabama, family members of a deceased soldier have the right to receive free education for four years at a college or other educational institution if the deceased lived in that state before joining the service for at least one year. Along with this, the remaining spouse and children are exempt from paying a number of taxes on home ownership.
Massachusetts provides for exemption from real estate tax (up to $ 950), as well as school benefits. In a number of other states, children in families that have lost a breadwinner are allocated up to $ 2,800 per year for a person to study at any state university, including private ones. Tax exemption for housing up to 25 percent is provided. estimated value of the building. State-funded tuition grants are paid regardless of the granting of similar federal payments.