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Category: Oregon

Oregon Military Filing Information


You are an Oregon resident if you live in Oregon but are in the military and claiming the subtraction for military active duty pay.


If you are filing as a nonresident of Oregon because you are in the state for military service, your military pay while stationed in the state is not taxable. File a nonresident return if you had other income from Oregon sources, or to claim a refund of Oregon tax withheld from your military pay.

Active Duty Subtractions:

You may qualify for more than one subtraction for U.S. military active duty pay. To be eligible for the subtractions, the active duty pay must be included in federal adjusted gross income (AGI). Guard and reserve annual training, weekend drills, and inactive duty training are considered active duty.

The Oregon military active duty pay subtractions are:

1. Active duty outside Oregon- As of August 1, 1990, you can subtract active duty pay earned anywhere outside Oregon until the date the president sets as the end of combat zone activities. The date was not set when this material was printed. You are not required to be stationed in a designated combat zone to be eligible for this subtraction.

2. Active duty in Oregon- You may subtract up to $6,000 of active duty pay earned in Oregon. Each spouse receiving active duty pay may claim the subtraction up to a limit of $6,000 each ($12,000 total on a joint return).

Nonresident spouse of military member stationed in Oregon

The federal Military Spouse Residency Relief Act prevents Oregon from taxing your Oregon wages if you meet certain criteria. If you are in Oregon only to be with your spouse who is stationed here and you both are domiciled outside of Oregon, your Oregon wages are exempt from Oregon tax and are not Oregon-source income. Note: This exemption does not apply to spouses who are also members of the military.

You are not required to file an Oregon return unless you had other income from an Oregon source or Oregon taxes withheld from your pay. Examples of Oregon-source income:

• Nonmilitary wages or business income earned by your spouse in Oregon,

• Earnings from an Oregon rental property.

If you file, use Form 40N. Include all of your wages on line 8 in the federal column only. Don’t include your exempt income (or your spouse’s military pay) in the Oregon column. There is no further adjustment for your exempt wages. For information about the military pay subtraction for your spouse’s military pay, see Nonresidents stationed in Oregon.

If Oregon taxes were withheld from your exempt wages, you should file Form W-4 with your employer. At the top, write "For Oregon Only—exempt military spouse" and write exempt on line 7. Your employer may require proof that you qualify for the exemption

Extension for filing your return

You can get an extension to file your return but not to pay your tax. You must pay the entire tax by the due date to avoid interest and penalty charges.

You are allowed the same extension period for Oregon as allowed for your federal return. Do you need an extension to file only your Oregon return? Or, do you have a federal extension but need to make a payment to Oregon with your extension? Use Oregon Form 40-EXT. Go to our website to download the form or call us to order the form.

Were you stationed in a combat zone or contingency area? Did you receive additional time to file your federal return and pay your 2013 tax? If so, Oregon allows the same additional time to file and pay your Oregon tax. Write "Combat Zone" in blue or black ink at the top of the return.

For further information regarding Oregon and Military filing click here