What is the Military Spouse Residency Relief Act (MSRRA)?
Military spouses are often on the move, and as they travel, the idea of what constitutes a “hometown” can become a bit blurry. Where are you eligible to vote? In what state can you claim residence? The MSRRA, which became effective in 2009, provides clarification and protections for military spouses with regard to residency, voting, and taxation.
Residency: MSRRA allows a military spouse to have the same place of residency that their service member has established or is residing in due to military orders. You’ve probably lived in a number of interesting places during your service member’s career, and might like to claim residency in one of those places, but this law does not permit you to choose any state you desire for residency. Not all residency requirements are the same, so spouses will need to check the specifications for their particular state. Ways to establish residency may include voting, paying taxes, and registering a vehicle in that state.
Does this sound confusing? Here’s an example: Sally is married to Tom. Sally is in the military and has established the state where she was born as her state of residence. If Tom meets the state’s eligibility requirements he may choose:
- Sally’s state of residency as his state of residency; or
- The state where they are stationed as his state of residency while they are in that state.
Please read here for more detailed examples.
Voting: A military spouse may vote in the service member’s state of residency or the state where the spouse currently resides due to military orders. Some states will need to develop policies to allow spouses to register to vote if they currently reside outside that state, have never voted in that state before, or do not have a mailing address in the state.
Taxes: MSRRA states a military spouse will neither lose nor acquire a residence for tax purposes by entering or leaving a tax jurisdiction while accompanying a service member who is moving as a result of military orders, as long as the residence is the same for husband and wife. The tax provisions in the MSRRA have implications for both state income tax and certain personal property taxes, such as vehicle registration fees, imposed by states and local jurisdictions. Real property taxes (those paid by homeowners) are not affected.
A military spouse is exempt from income taxes in a state where income was earned when all four qualifications are met:
1. The spouse currently resides in a state different than the state of his or her domicile;
2. The spouse resides in the state solely to live with the service member;
3. The service member is present in the state in compliance with military orders; and
4. The spouse and service member are both able to claim the same domicile.
Using the example of Sally and Tom above, if Tom was eligible and established residency in the state where Sally was born, he would pay his income taxes (assuming the state has an income tax) to the state where he has established residency rather than the state where he is working.
Spouses claiming a tax exemption from the state in which they have earned income should consider the impact on their income tax liability in their resident state. Additionally, military spouses should not assume their tax status will be the same as the service member’s in their state of residency. A state may exempt military income earned while the service member is on orders out-of-state, but MSRRA does not automatically extend this exemption to a military spouse.
Property rights: Under the MSRRA, residency requirements related to land rights, such as mining claims or homesteading, will be suspended for spouses just as they are suspended under SCRA for service members. For example, some states require the executor of an estate to be a resident of the state.
Get Facts from the Experts: The Federation of Tax Administrators works closely with tax officials from all States and has posted a more in-depth analysis of MSRRA on its website. A legal summary of the law is available here.
MSRRA is complicated, but can be helpful once you understand its basic benefits. We recommend you seek assistance from a military legal assistance office to get information that pertains to your particular situation.
Until military families are relieved of the weight of war, we hope you will continue to contribute to their wellbeing.
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