The Combat Zone Tax Exclusion (CZTE) allows military personnel serving in designated combat zones to exclude certain income from federal income tax. This exclusion applies to active duty members of the U.S. Armed Forces and can significantly reduce their taxable income, providing financial relief during deployment. To qualify for the CZTE, service members must be stationed in specific areas recognized by the Department of Defense as combat zones. The exclusion typically covers pay received for active duty service, including bonuses and certain allowances, helping to support military families during challenging times.