Maine state tax refund military getting confused with property taxes

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Summary of Maine Military and Veterans Benefits: Maine offers special benefits for service members, Veterans and their families including property tax exemptions, tax exemptions, employment assistance, employment preference, tuition assistance, state parks and campground reduced fees, special vehicle license plates, as well as hunting and fishing privileges. Eligibility for some benefits may depend on residency, military component and disability status.

Maine Bureau of Veterans’ Services, Veterans’ Services Offices: The Maine Bureau of Veterans’ Services has Veterans’ Services Offices located throughout the state that can assist Veterans, and their families find and apply for benefits under federal, state, and local laws. All their services are provided free of charge.
Maine Bureau of Veterans’ Services, Veterans’ Services Offices Directory

Maine Military and Veterans State Benefit Highlights and Eligibility

Welcome to Maine



What are my Maine Military and Veterans State Tax Benefits?

Maine Military Retired Pay Income Taxes: Maine does not tax military retired pay.

Thrift Savings Plan (TSP) does not withhold taxes for state or local income tax, but it is reported annually on IRS Form 1099-R. All TSP distributions are subject to state taxes and early distributions may incur higher taxes

Maine Income Taxes on Military Pay:Military pay received by a Maine resident service member serving on active duty in the U.S. Armed Forces who is stationed outside of Maine is exempt from state income tax.

Maine Nonresident Military Spouse Income Tax Exemption: Eligible nonresident military spouses do not have to pay Maine income tax for wages earned in Maine.
Who is eligible for the Indiana Nonresident Military Spouse Earned Income Deduction?
To be eligible nonresident military spouses must meet the following requirements:

Maine Income Tax on Military Disability Retirement Pay: Military Disability Retirement Pay received as a pension, annuity or similar allowance for personal injury or sickness resulting from active service in the U.S. Armed Forces should not be included in taxable income. Some of the payments which are considered disability benefits include:

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Maine State Taxes on U.S. Department of Veterans Affairs Disability Dependency and Indemnity Compensation (DIC): DIC is a tax-free monetary benefit paid to eligible survivors of service members who died in the line of duty or eligible survivors of Veterans whose death resulted from a service-connected injury or disease.

Maine State Tax Exemption for Military Survivor Benefit Plan (SBP), Reserve Component Survivor Benefit Plan (RCSBP), and Retired Serviceman’s Family Protection Plan (RSFPP) Annuities: SBP, RCSBP and RSFPP annuities are not taxed in Maine.

Maine State Tax Benefits for Service Members Serving in a Combat Zone: Maine follows many of the federal tax rules for pay received by a service member who is serving in a combat zone (receiving hostile fire and imminent danger pay).