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Military Income Tax Question

andrewsw16
I have a question concerning the Foreign Earned Income Exclusion. My daughter is facing a possible active duty transfer to an overseas base for about three years. I am pretty sure that if she was a civilian contractor she would qualify for the FEIE income exemption. As an active duty military member, would she also be entitled to exclude up to $102,000 from her federal income tax? This will be to Germany, and NOT an official combat zone. I have looked around the internet but all I find is answers concerning civilian contractors sent overseas by their companies. I can't find out whether active duty qualifies for this good deal.
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Comments

4 comments

Date Votes
  • Smoky14
    I've been out for sometime now, but unless in a combat zone I paid taxes as if I was stateside.
    Smoky
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  • wtroper
    I expect that because her "abode" is still in USA, she will not qualify for the FEI exclusion. Several relatively recent court cases (past two or three years) have held that even civilians who maintained a residence here and family here while they were overseas, did not qualify because their abode remained in the US.
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  • Sam06
    She has to pay state and federal income tax unless she is in a Combat Zone.
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  • wtroper
    Amounts paid to employees of the USA do not qualify as "Foreign Earned Income." See IRS publication #54 page 18.
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