Income

• 1). Determine your income. Military personnel who file taxes while serving in a combat zone are entitled to exclude some of their pay from overall income. However, this amount does not need to be represented on your return because it has already been accounted for on your W-2. Box 1 of your W-2 should not include any income, which is excluded under the combat zone provision.
  
  
• 2). Calculate your filing deadline. In addition, the time deadline for completing your return and paying any tax owed is automatically extended if you are serving in a combat zone. The deadline for those deployed in a combat zone is 180 days after the last day you are in a combat zone or serve in a contingency operation or the last day of your hospitalization as the result of being in a combat zone. Additionally, your 180 days is extended by the amount of time that you had remaining on the expiration of IRS deadlines when you entered the combat zone. For example, if you entered the combat zone on April 1, then you will have 15 days (the time between April 1 and April 15) plus 180 days to file your return. The maximum interest service members can be charged is limited to 6 percent.
  
  
• 3). Use the IRS's on-site help to aid you in completing your return. Military personnel who are deployed on a military base, either domestic or international, can have their tax returns prepared for free by volunteers through the Armed Force's Tax Counsel (AFTC). The AFTC staffs personnel and military installations worldwide for the sole purpose of assisting airmen, marines, guardsmen and soldiers with their tax needs.
  
  
• 4). Sign and mail your return. If you are filing a joint return and will not be available to sign your return with your spouse, complete a power of attorney to give your spouse the authority to sign on your behalf. You can download IRS form 2848 online or order it by calling 800-TAX-FORM. Before your deployment, you and your spouse should sign the form and mail it in to the IRS. Use form 2848 to appoint anyone you trust to handle your tax affairs while you're deployed. Revoke it at any time by writing the IRS.