The National Directory of Certified Public Accountants

Ask A CPA - Armed Forces Tax Information

Earned Income Credit - Combat Pay

Special Rule for Combat Pay. Combat pay received by members of the military serving in Afghanistan, Iraq and other combat zone localities is usually exempt from tax. But under a special rule, the taxpayer can choose to count all of this as taxable income when figuring the EITC. In many cases, making this choice enables the person to claim the credit, or if already eligible, claim a larger credit.

If you need professional help with "Armed Forces Tax Information" or have other tax questions, we can help you find a local licensed CPA for a free, no-obligation consultation.