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10470: Forgiveness of Tax Liability for Military Personnel


Tax Info + Help Generally

If an individual dies while operating in a combat zone, or during a military or terrorist action, is his income taxable?

Pub. 3, Armed Forces' Tax Guide explains:

"Forgiveness of Decedent’s Tax Liability

Tax liability can be forgiven, or if already paid, refunded, if a member of the U.S. Armed Forces dies:

  • While in active service in a combat zone,
  • From wounds, disease, or other injury received in a combat zone, or
  • From wounds or injury incurred in a terrorist or military action.

. . .

Combat Zone Related Forgiveness

Combat zone related forgiveness occurs when an individual meets both of the following criteria.

  1. Is a member of the U.S. Armed Forces at death.
  2. Dies while in active service in a combat zone, or at any place from wounds, disease, or injury incurred while in active service in a combat zone.

Except as limited in Deadline for Filing a Claim for Tax Forgiveness, later (in Pub. 3), forgiveness applies to:

  • The tax year death occurred, and
  • Any earlier tax year ending on or after the first day the member served in a combat zone in active service.

In addition, any unpaid taxes for years ending before the member began service in a combat zone will be forgiven and any of those taxes that are paid after the date of death will be refunded." ​

 

For further details, see ​​Pub. 3.


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