Connecticut State Income Tax Information for Military Personnel and Veterans
This Informational Publication has been superseded by IP 92(2.1)
If you are a member of the armed forces in active service, you may have some questions about filing a Connecticut income tax return.
This publication explains who is a Connecticut resident and who is a Connecticut nonresident. It also explains how to file a Connecticut income tax return.
In general, a resident is anyone who is domiciled in Connecticut. However, a person domiciled in Connecticut who meets certain conditions may be a nonresident for Connecticut income tax purposes.
DOMICILE AND PERMANENT PLACE OF ABODE: To determine your resident status for state income tax purposes, you have to consider where your domicile was and where you maintained a permanent place of abode during the taxable year.
Your domicile is the place that you intend to have as your permanent home. It is the place you intend to return to whenever you may be away. For income tax purposes, your domicile is the state where your permanent home is located.
You can have only one domicile. Your domicile does not change until you move to a new location and definitely intend to make your permanent home there. If you move to a new location but intend to stay there only for a limited amount of time (no matter how long), your domicile does not change. Military assignments do not affect your domicile.
A permanent place of abode is a residence (a building or structure where a person can live) that you permanently maintain, whether or not you own it, and usually includes a residence your husband or wife owns or leases. A place of abode is not permanent if you maintain it only during a temporary or limited period of time for a particular purpose (e.g. a temporary duty assignment).
Barracks, quarters on a ship or any structure that contains only bachelor-type quarters and not facilities ordinarily found in a dwelling, such as facilities for cooking and bathing, will generally not qualify as a permanent place of abode.
RESIDENT AND NONRESIDENT DEFINED: If your domicile was Connecticut when you entered the military, your domicile does not change unless you have voluntarily abandoned your Connecticut domicile, established a new domicile in another state, and taken necessary actions to change your legal home of record with the armed forces. You are a resident and must file a resident return and pay any tax due unless you meet all three of the following conditions for the entire taxable year:
1. You did not maintain a permanent place of abode in Connecticut;
2. You maintained a permanent place of abode outside Connecticut;
3. You spent 30 days or less in Connecticut.
Steve was a resident of Connecticut when he joined the Army and has not established a new domicile. He does not maintain a permanent place of abode in Connecticut. He visited his parent's home in Connecticut for only two weeks in the taxable year. He lives in bachelor-type housing at his permanent duty assignment in Texas.
Steve is a resident for Connecticut income tax purposes because bachelor-type housing does not qualify as a permanent place of abode.
Moira was a Connecticut resident when she entered the Navy and has not changed her resident status with the military. Her permanent duty assignment is San Diego, California. For all of 1991 she rented an apartment. She did not visit Connecticut in 1991 and she does not have a permanent place of abode in Connecticut.
Moira was a nonresident for 1991. An apartment or house rented or owned for the entire taxable year at a permanent duty assignment qualifies as a permanent place of abode outside Connecticut.
Same facts as in Example 2 but in 1992, Moira is temporarily assigned to a naval base in Florida for advanced training. She gives up her apartment in San Diego and rents a house near the base in Florida.
Moira is a Connecticut resident in that taxable year. A place of abode is not permanent if it is maintained only during a limited or temporary period or for a particular purpose.
If you meet all three conditions, you are a nonresident of Connecticut for the taxable year and do not have to file a resident income tax return. If you have any income from Connecticut sources, however, you may owe Connecticut income tax and may have to file a nonresident income tax return. Read the next section for further information on the nonresident tax.
NONRESIDENT MEMBERS OF THE ARMED FORCES: If your domicile was not Connecticut when you entered the military and you were later assigned to active duty in Connecticut, you do not become a Connecticut resident even if you maintain a permanent place of abode here. You are a nonresident and your military compensation is not subject to Connecticut income tax.
However, other income that you receive from Connecticut sources while you are a nonresident (including your spouse's income) may be subject to tax. If you have a civilian job in Connecticut during your off-duty hours, the income you receive is subject to state income tax. Income or gain received by a nonresident from property located in Connecticut or from a business, trade or profession carried on in this state is also subject to tax.
Bob and Sue are residents of Florida. Bob enlisted in the Navy in Florida, was stationed in Groton, Connecticut and moved here with Sue, his wife. He earned $38,000 in military pay.
A. They had no other income. Military personnel and their spouses are residents of the state in which they resided when they enlisted. Since Bob resided and enlisted in Florida and his wife is a Florida resident, he and his wife are not considered a residents of Connecticut and does not have to file a Connecticut return.
B. Sue is employed in a Connecticut company and earns $29,000 per year in wages. Her Connecticut source of income is taxable and should be reported on a CT-1040NR/PY.
John is domiciled in Connecticut but he is stationed in Texas and meets all three conditions of Connecticut nonresidency. He sold property in Connecticut during the taxable year on which he recognized a capital gain. He must file a nonresident return, Form CT-1040NR/PY, because income from the sale of property in the state is Connecticut source income.
PART-YEAR RESIDENTS: If you change your domicile from Connecticut (or to Connecticut) during the taxable year, you are a part-year resident for the taxable year. A part-year resident is subject to tax on all income earned during the resident portion of the year and on income from Connecticut sources during the remainder of the year.
For more information about Connecticut nonresident and part-year resident income tax, order Form CT-1040 NR/PY, Connecticut Nonresident or Part-Year Resident Income Tax Forms, by calling the number for forms listed on the last page of this publication. State tax forms are also available in town libraries, many banks and post offices in Connecticut.
RESIDENT MEMBERS OF THE ARMED FORCES: If you are a Connecticut resident in the military and you meet either of the following conditions, you have to file a resident return using Form CT-1040 or Form CT-1040EZ:
You had Connecticut income tax withheld or made estimated state income tax payments in 1991;
Your federal gross income (plus any income that is federally exempt, but subject to Connecticut income tax) exceeds:
- $12,000 for a Single person or a Married person filing separately
- $19,000 for a Head of Household
- $24,000 for Married persons filing jointly.
You are liable for capital gains, dividends, and interest income tax in 1991 because:
- You recognized a capital gain in 1991; or
Your modified adjusted gross income was $54,000 or more in 1991 and you earned dividends or interest income.
TAXABILITY OF MILITARY PAY FOR RESIDENTS: If you are a Connecticut resident, your military pay or your military pension is subject to Connecticut income tax. Your military pay or pension is taxable on your Connecticut return in the same way that is it taxable on your federal return.
Disability pensions and any other benefits granted for the relief of injuries or disabled veterans, as well as tuition payments, subsistence allowances and any other benefits paid to, or on account of, a veteran or beneficiary under the laws relating to veterans, are treated the same for Connecticut income tax purposes as for federal income tax purposes. If these amounts are excludable from gross income for federal income tax purposes, they are not subject to Connecticut income tax.
WITHHOLDING AND PAYMENT OF ESTIMATED INCOME TAX: If you are a Connecticut resident, your military pay is subject to withholding of Connecticut income tax. You should complete Form CT-W4 and provide it to your military finance officer. However, if you will meet the conditions for nonresident status in the taxable year, you can request that no Connecticut income tax be withheld from your pay by checking the exemption box on Form CT-W4 and filing it with your military finance officer. Do NOT send Form CT-W4 to the Department of Revenue Services. Form CT-W4 is available from your military finance officer.
If you expect your state tax withheld to be less than 100% of your 1992 state income tax or less than 100% of your 1991 state income tax (recalculated to the 1992 rate of 4.5%), you may need to pay estimated tax. You may request a copy of Form CT-1040ES, 1992 Individual Estimated Income Tax Payment Forms, for more information. Estimated payments must be made if you will have more than $1,000 in Connecticut taxable income from which no state tax is withheld.
REQUESTING A REFUND: If you are domiciled in Connecticut but meet all three conditions for nonresidency you must file Form CT-1040NR/PY to claim a refund of Connecticut income tax withheld in error. You must attach an explanation that contains the following:
A statement that you did not have a permanent place of abode in Connecticut during the taxable year;
- The location and a brief description of the permanent place of abode you maintained outside Connecticut and the beginning and ending dates of your stay there;
- The exact number of days you were in Connecticut during the taxable year.
If you are a resident you must file Form CT-1040 or Form CT-1040EZ if the amount withheld from your pay or the amount paid in estimated tax is more than the Connecticut income tax you owe. (Nonresidents file Form CT-1040NR/PY to claim a refund under these circumstances.)
WHEN TO FILE YOUR RETURN: As a member of the armed force you must file your Connecticut return at the same time and in the same manner as any other taxpayer. File your return as soon as you can after January 1, 1992, but no later than April 15, 1992. If you file for a fiscal year, your return is due by the 15th day of the fourth month following the end of your fiscal year.
EXTENSION OF TIME TO FILE RETURNS: If you cannot meet the April 15 deadline and need to extend the time for filing your return, you must use Form CT-1040EXT, Application for Extension of Time to File Connecticut Income Tax. The time to file your return will be extended six months. File Form CT-1040EXT on or before the due date for filing your return to get an extension of time to file. Your Form CT-1040EXT must be accompanied by a full payment of tax due. Penalty of 10% of the underpayment and 1 1/4% per month (or fraction thereof) will apply to underpayment of tax.
If you are stationed in a foreign country when your return is due, even though you have an automatic extension for federal income tax purposes, you must file Form CT-1040EXT.
If you are serving in a combat zone when your return is due or you are hospitalized as a result of your military service in the combat zone, you are allowed six months from the date you leave the combat zone or are released from hospitalization to file your Connecticut income tax return without interest or penalty. You do not have to request an extension of time to file your return. Just attach to your return a statement showing your dates of combat service or hospitalization.
DEATH OF MILITARY PERSONNEL: When a member of the military dies while on active duty in a combat zone or as a result of injuries received while serving in a combat zone, all income taxes are waived for the taxable year of the death and for any prior taxable year ending on or after the first day the deceased served in that combat zone. No income tax returns have to be filed for the deceased or the estate for these years.
If the deceased paid any tax while in the combat zone, the full amount of the tax paid will be refunded to the estate or surviving spouse provided a return is filed to claim the refund. If any tax was assessed but not paid, the assessments will be canceled.
FOR FURTHER INFORMATION: Please call DRS during business hours, Monday through Friday:
- 1-800-382-9463 (toll-free within Connecticut), or
- 860-297-5962 (from anywhere)
TTY, TDD, and Text Telephone users only may transmit inquiries 24 hours a day by calling 860-297-4911.
FORMS AND PUBLICATIONS: Forms and publications are available all day, seven days a week:
- Internet: Preview and download forms and publications from the DRS Web site: http://www.ct.gov/drs
- Telephone: Call 860-297-4753 (from anywhere), or 1-800-382-9463 (toll-free within Connecticut) and select Option 2 from a touch-tone phone.