Some spouses get tax extension to Oct. 15 - Military News | News From Afghanistan, Iraq And Around The World - Military Times

Some spouses get tax extension to Oct. 15

Military spouses living in Guam, the Northern Mariana Islands, Puerto Rico or the U.S. Virgin Islands can delay paying their federal tax returns until Oct. 15 if they meet two requirements, the Internal Revenue Service has announced.

The notice, quietly issued by the IRS on April 15, applies to spouses who:

• Were away from their residence or domicile (tax residence) in a state or the District of Columbia during 2009 solely to be with a military spouse on military orders in one of those U.S. territories.

• Maintained their tax residence in a state or D.C. under the Military Spouses Residency Relief Act (MSRRA).

The IRS generally allows taxpayers to file for an extension, but taxpayers must send estimated payments with the extension request. This IRS action allows these spouses to delay any payments.

However, spouses will owe interest on the amount of taxes from the date due, although they will not have to pay additional penalties. The IRS already allows those living outside the U.S. and Puerto Rico, including military personnel, a filing extension until June 15.

The notice states that because the MSRRA was enacted late last year — Nov. 11 — and applies retroactively to 2009, “the IRS recognizes that taxpayers working in a U.S. territory who claim tax residence in a state or the District of Columbia may experience undue hardship in timely paying federal income tax liabilities” for 2009.

This payment extension does not apply to civilian spouses who are federal employees in American Samoa, Guam or the Virgin Islands, or to individuals working in Guam or the Northern Mariana Islands who are covered under Section 935 of the Internal Revenue Code. In those cases, the employer sends tax payments to the territory instead of to the IRS; now, under the MSRRA, those payments will revert to the IRS.

Contact information for each territory’s tax division is included on pages 15 and 16 of the IRS notice. Spouses should contact their military installation’s legal assistance office for help.

There are specific instructions for filing for the payment extension. At the top of the IRS Form 4868 (automatic extension of time to file), the spouse should mark “MSRRA” in red ink, and include a copy of the W-2 or equivalent forms they received from their employers. Complete information about a declaration that spouses must make, and where the request should be mailed, are included on page 7 of the notice.