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Military Personnel – How Minnesota Taxes Your Income
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Like individuals, Minnesota taxes the income of military personnel based on residence. To help you understand your residency situation, here are three examples based on common residency situations.
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You are a Minnesota resident and a member of the U.S. or U.N. armed forces, the Minnesota National Guard, or other reserve component in Minnesota.
| If you | Then |
|---|
Received either: - Federally taxable active-duty military pay
- Federally taxable pay for training and certain types of service, including any of these:
- Annual or weekend training
- State active service (including natural disaster emergency response and missing person searches)
- Federally-funded state active service, including airport security duty, active duty for special work, and active guard reserve (U.S Code, titles 10 and 32)
| You qualify for the active-duty military pay subtraction. Subtract this income on Schedule M1M, Income Additions and Subtractions. |
Received federally taxable military retirement pay under U.S. Code, title 10 | You may subtract your military retirement pay from your taxable income on Schedule M1M. If you claim this subtraction, you may not claim the nonrefundable Credit for Past Military Service. |
| Are a U.S. Public Health Service employee and are called to active duty in the armed forces under U.S. Code, title 10 | You are eligible for a subtraction of pay received for this period only. Subtract this pay on Schedule M1M. |
You are a full-year Michigan or North Dakota resident and a member of the Minnesota National Guard.
| If you (and your spouse if filing a joint return) | Then |
|---|
| Had no Minnesota source income other than your Minnesota National Guard pay | Your pay is covered by reciprocity if you returned to your home state at least once a month. You do not need to file a Minnesota return. Contact your home state’s tax department for more information. |
Had Minnesota source income that is not covered by reciprocity and meets or exceeds the state minimum filing requirement | Include the amount of your federally taxable Minnesota National Guard income on Schedule M1M. Complete Schedule M1NR, Nonresidents/Part-Year Residents. When completing column B, do not include your Minnesota National Guard income or any other income you received that is covered by reciprocity. |
Note: See Reciprocity for the types of income covered by reciprocity.
You are a nonresident of Minnesota who received federally taxable active-duty military pay. Your military pay is not taxable to Minnesota. Also, your spouse’s wages are not taxable to Minnesota if their legal residence ("domicile") is the same as yours and they are in Minnesota only to be with you.
Note: See How Minnesota Taxes Nonresident Income for information on what types of income are taxable to Minnesota.
| If | Then |
|---|
| You (or your spouse if filing a joint return) had no income taxable to Minnesota | You do not need to file a Minnesota return. Refer to your home state’s tax department. |
| Your income taxable to Minnesota (and your spouse’s if filing a joint return) is less than the state minimum filing requirement | You do not need to file a Minnesota return. Refer to your home state’s tax department. |
| You (and your spouse if filing a joint return) had income taxable to Minnesota greater than or equal to the state minimum filing requirement | Complete Schedule M1NR. Include your non-military wages and any other income taxable to Minnesota in column B. Do not include your military pay in column B. If your spouse’s domicile is the same as yours and they are in Minnesota only to be with you, do not include their wages in column B. |
