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Is my military pay taxable on my individual income tax return?
- pay for duty in the armed forces, including basic training;
- pay for duty as a cadet at the U.S. Military, Air Force, and Coast Guard academies, as a midshipman at the U.S. Naval Academy, or in ROTC; and
- pay for duty for serving in the U.S. Armed Forces Reserves or a National Guard unit, including a National Guard unit of another state.
- certain combat pay that is not included in your adjusted gross income, Line 1;
- pay you received under the Voluntary Separation Incentive;
- pay you received from the military as a civilian;
- pay you received under the Air Force Voluntary Separation Incentive Plan (VSP);
- payments you made under the Ready Reserve Mobilization Income Insurance Program; or
- pay for duty as an officer in the Public Health Service.
You may subtract the amount of any federally-taxed portion (not the gross amount) included in Form IL-1040, Line 1, that you received from a government retirement or government disability plan, including military plans, reported on your federal Form 1040.
You may subtract tax-exempt military pay that is in your AGI, including
Note: For tax years ending prior to December 31, 2001, you may only subtract compensation paid for active duty.
Note: For tax years ending prior to December 31, 2007, you may subtract National Guard pay only if you were in the Illinois National Guard.
You may not subtract:
You must attach your Form W-2, Wage and Tax Statement, showing your military pay. For more information refer to Publication 102, Illinois Filing Requirements for Military Personnel.