Relocating frequently is a reality for military families, bringing with it many logistical and legal challenges. Fortunately, two key laws—the Military Spouses Residency Relief Act (MSRRA) and the Veterans Benefits and Transition Act of 2018—help ease the burden by allowing military spouses to maintain or choose their state of legal residence for tax and voting purposes.

Maintaining Legal Residence Under MSRRA

For most civilians, legal residency is determined by where they live. However, because service members and their families often move due to military orders, residency laws provide special provisions.

The Military Spouses Residency Relief Act (MSRRA), enacted in 2009, allows military spouses to maintain the same state of legal residence as their service member—provided they previously lived in that state. Then, in 2018, the Veterans Benefits and Transition Act expanded this right, allowing spouses to choose their service member’s state of legal residence as their own, even if they never lived there.

To qualify under the MSRRA:

• The service member must be stationed in a state different from their legal residence due to military orders.
• The spouse must reside in that state solely to live with the service member.
• Both the service member and spouse must share the same state of legal residence.

When these conditions are met, the spouse is only required to pay state income taxes in their legal state of residency, rather than the state where they currently live.

2022 Updates: Expanded Residency Options

The Veterans Auto and Education Improvement Act of 2022 further revised the Servicemembers Civil Relief Act (SCRA) by granting military spouses even more flexibility in choosing their legal residence. Now, spouses can:

• Maintain residency in their own home state instead of adopting the service member’s legal residence.
• Retain residency in a former state even if they no longer live there.

How This Affects Taxes and Voting

Military spouses can vote and file taxes in their chosen state of legal residence. However, only military pay is protected under SCRA’s tax provisions. Any additional income earned by a service member—such as from a side business or rental property—is subject to taxes in the state where it was earned.

Military spouses may also need to pay state income taxes in the state where non-military income is generated, even if their residency is elsewhere. Business owners should consult a tax professional to determine their obligations under MSRRA and SCRA.

Professional License Portability for Military Spouses

One of the most significant challenges for military spouses is maintaining their careers while relocating. The Veterans Auto and Education Improvement Act of 2022 introduced new provisions for professional license portability, allowing spouses to continue working under their existing licenses after a military move. To qualify:

• The relocation must be due to military orders.
• The spouse must provide a copy of the orders to the new state’s licensing authority.
• The license must have been actively used within the past two years before the move.
• The license must be in good standing with the issuing authority.
• The spouse must comply with the new state’s professional standards, continuing education, and disciplinary requirements.

Final Thoughts

Understanding these residency and tax laws can help military families navigate the complexities of frequent moves. By leveraging the benefits provided under MSRRA, SCRA, and the Veterans Benefits and Transition Act, military spouses can better manage their tax obligations, voting rights, and professional careers—making transitions between duty stations a little easier.