TN 101 (09-08)

SI 00830.540 Uniformed Services - Pay and Allowances, Effective Before September 1, 2008

Citations:

Social Security Act, sections 209, 1611(c) , and 1612(a) and 1612(b) ;

20 CFR 404.1059(c) , 404.1330 ; 416.1120

A. Introduction

Compensation to most members of the Uniformed Services takes the form of both earned and unearned income, and often both cash and in-kind income.

All branches of the Uniformed Services adhere to a single pay system, but that system is complex and varies significantly from branch to branch. Proper and efficient handling of cases requires an understanding of:

  • how the pay system works;

  • what the key terms mean; and

  • how SSI policies and procedures apply to different forms of compensation.

For the policy and procedures effective for supplemental security income (SSI) payments payable on or after September 1, 2008, see SI 00820.400, Uniformed Services—Pay and Allowances Effective September 1, 2008.

B. Definitions

1. Additional Pay

Additional pay is any additional increment in pay, other than an increase in basic pay (e.g., COLAs, promotions). Increases in basic pay include items such as cost-of-living allowances (COLA) and promotions.

2. Advance Pay

In the Uniformed Services, advance pay is a cash loan to be repaid in cash installments, usually by payroll deductions, rather than by future work. Advance pay is not taxed and is not income for SSI purposes. (See SI 00815.350 for information regarding the treatment of loans in the SSI program.)

3. Allowances

Allowances are cash benefits that compensate the service member, at least in part, for the expenses of housing, food, clothing, and special situations during periods of active duty service. Allowances are not paid for weekend drills of Reserve and National Guard components.

Allowances are not subject to FICA tax and usually are not subject to income taxes.

Often, for accounting purposes, a service branch changes a subcategory of allowance retroactively (e.g., from one type of subsistence allowance to another). The change is explained on the pay slip by showing, as an entitlement, the full amount due for the earlier month under the correct subcategory (e.g., leave rations). The full amount previously paid as the entitlement for the earlier month under the incorrect subcategory is shown as a deduction (e.g., separate rations). The amounts may be identical or different. (See SI 00830.540D.7. for the policy governing these retroactive adjustments.)

4. Allotments

Allotments are deductions, usually from a service member's paycheck, for special purposes. Allotments are often requested for purposes such as:

  • payments to dependents;

  • deposits to a savings account;

  • charitable contributions; and

  • the purchase of savings bonds.

5. Basic Allowance for Housing

The basic allowance for housing (BAH) is an amount of money that a service member receives to pay for housing not provided by the Government. It is a combination of the old basic allowance for quarters (BAQ) and the variable housing allowance (VHA). The BAH was designed to make housing allowances more equitable throughout the services and the ranks, and more in line with civilian cost of living in the areas surrounding military installations.

In some cases, the service branch may pay a BAH to a service member living in free on-base housing, but then deduct the allowance (rather than rent) in the same month. This transaction is merely for accounting purposes and results in a zero payment transaction. What is actually received is rent-free shelter. See SI 00830.540D.5. and SI 00835.370 for the policy governing rent-free shelter. The BAH is based on the service person's rank, and has nothing to do with the current market value (CMRV) of the shelter. The CMRV of the shelter must be obtained, for presumed maximum value rebuttal purposes, by determining what the shelter would rent for in the community (i.e., off the military installation). See SI 00830.540D.4. for the policy governing BAH paid and deducted in the same period.

6. Basic Allowance for Subsistence

Subsistence means food and is also referred to as rations. Service members usually receive either free rations from a service facility or an allowance for rations. (The value of free rations does not appear on pay records.)

Prior to 2002, subsistence was paid in two different ways - at a fixed rate for officers and a daily rate for enlisted persons. Effective 2002, the subsistence is paid at a fixed monthly rate for both officers and enlisted persons. This applies to all branches of military service.

7. Basic Discount Meal Rate (BAS DISC MEAL RATE)

The Basic Discount Meal Rate (BAS DISC MEAL RATE) is the amount deducted from the service member’s pay for subsistence (rations) when a meal card is issued for purchasing food at an on-base dining hall. The value of the meal card is based on a standard daily rate.

8. Basic Pay

Basic (or base) pay is the service member's wage. It is based solely on the member's pay grade and length of service. Basic pay is subject to FICA tax as well as income tax.

(Prior to January 1, 1988, basic pay for weekend drills of Reserve and National Guard components was not wages and not subject to FICA tax.)

9. Clothing Issuances and Allowances

There are 3 basic types of clothing allowances:

a. Initial Clothing Allowances

Initial clothing allowances are provided to enlisted members upon initial enlistment or upon other special qualification for entitlement to a prescribed outfitting of uniforms. The initial issue may be an in-kind issue or a combination of in-kind issue and cash payment.

b. Cash Clothing Replacement Allowances

Cash clothing replacement allowances are paid to enlisted members upon the anniversary month each successive year following the provision of an initial clothing allowance. Cash clothing replacement allowances are for replacement of required uniform items based on a normal wear rate.

c. Extra Clothing Allowance

Extra clothing allowances are additional to initial and replacement allowances and do not reduce, replace, or otherwise affect them. Extra clothing allowances cover unusual circumstances when an enlisted member may require additional uniform items or when an officer (with a permanent duty station outside the United States) or enlisted member may require civilian clothing to perform his or her assigned duties.

10. Combat Zone

A combat zone is any area the President of the United States designates by Executive Order as an area in which the U.S. Armed Forces are engaging or have engaged in combat. An area usually becomes a combat zone and ceases to be a combat zone on the dates the President designates by Executive Order.

Following are the currently designated combat zones:

Afghanistan Area, By Executive Order No. 13239, Afghanistan (and airspace above) was designated as a combat zone beginning September 19, 2001.

The Kosovo Area, By Executive Order No. 13119 and Public Law 106-21, the following locations (and airspace above) were designated as a combat zone and qualified hazardous duty area beginning March 24, 1999.

  • Federal Republic of Yugoslavia (Serbia/Montenegro),

  • Albania,

  • The Adriatic Sea, and

    • The Ionian Sea – north of the 39th parallel

    Persian Gulf Area, Executive Order 12744 designated the following locations (and airspace above) as a combat zone beginning January 17, 1991.

    • The Persian Gulf,

    • The Red Sea,

    • The Gulf of Oman,

    • The part of the Arabian Sea that is north of 10 degrees north latitude and west of 68 degrees east longitude,

    • The Gulf of Aden, and

    • The total land area of Iraq, Kuwait, Oman, Bahrain, Qatar, Saudi Arabia, and the United Arab Emirates.

    Public Law 104-117 designates three parts of the former Yugoslavia (Bosnia and Herzegovina, Croatia, and Macedonia) as a Qualified Hazardous Duty Area to be treated as if it were a combat zone, beginning November 21, 1995.

    In addition, the Department of Defense has certified the following locations for combat zone tax benefits due to their direct support of military operations, beginning on the listed dates:

    In support of Operation Enduring Freedom (Afghanistan combat zone)

    • Pakistan, Tajikistan and Jordan – September 19, 2001,

    • Incirlik Air Base, Turkey – September 21, 2001 through December 31, 2005,

    • Kyryzstan and Uzbekistan – October 1, 2001,

    • Philippines (only troops with orders referencing Operation Enduring Freedom) – January 9, 2002,

    • Yemen – April 10, 2002,

    • Djibouti – July 1, 2002, In support of Operation Iraqi Freedom (Arabian Peninsula Areas combat zone),

    • Israel – January 1, 2003 through July 31, 2003, and

    • Somalia – January 1, 2004.

    In support of Operation Iraqi Freedom (Arabian Peninsula Areas combat zone),

    • Turkey – January 1, 2003 through December 31, 2005,

    • The Mediterranean Sea east of 30 degrees east longitude – March 19, 2003 through July 31, 2003,

    • Jordan – March 19, 2003, and

    • Egypt – March 19, 2003 through April 20, 2003.

    Serving in a combat zone includes any periods that a member of the military is absent from duty because of sickness, wounds, or leave. If, as a result of serving in a combat zone, a person becomes a prisoner of war or is missing in action, that person is considered to be serving in the combat zone for military pay purposes as long as he or she maintains that status.

11. CONUS COLA

The CONUS COLA (Continental United States Cost of Living Allowance) is paid to members of the Uniformed Services as compensation for a portion of excess costs for non-housing expenses incurred based on the geographical duty location. CONUS COLA is a monthly entitlement based on a 30-day month, the same as BAH. Private sector pay scales tend to reflect local living costs in U.S. locations, but military pay tables do not. The purpose of the CONUS COLA is to provide compensation for variations in non-housing costs in the continental United States. The CONUS COLA is considered a COLA (wages). It is not considered a special pay, additional pay, or an incremental increase in pay.

12. Entitlements

Entitlements are pay, allowances and other cash benefits due a service member. Entitlements can include basic pay, special and incentive pay, allowances, advance pay, and reimbursement for certain work-related expenses. In-kind benefits are not entitlements.

13. Family Subsistence Supplemental Allowance

The Family Subsistence Supplemental Allowance (FSSA) is a monthly cash allowance of up to $500 for low-income service members, the purpose of which is to eliminate the service member's receipt of food stamps. The service member has to apply for FSSA in order to receive up to the $500 per month. However, the service member does not have to file for FSSA as a condition of SSI eligibility.

14. Hostile Fire Pay/Imminent Danger Pay

Hostile fire pay and imminent danger pay (sometimes referred to as “combat pay”) are types of special pay to a service member who is:

  • subject to hostile fire or explosion of hostile mines; or on duty in an area in which he/she is in imminent danger of being exposed to hostile fire or explosion of hostile mines, and

  • while on duty in that area, other service members in the same area are subject to hostile fire or explosion of hostile mines; or

  • killed, injured, or wounded by hostile fire, explosion of a hostile mine, or any other hostile action.

15. Leave and Earnings Statement (LES)

The LES is the monthly pay slip issued to service members. Each service branch has its own version. SI 00830.540I. lists common abbreviations used on LESs.

16. Pay Grade

The pay grade is an alphanumeric code designating the rank of a service member. It also indicates whether that service member is:

  • an enlisted member (pay grades E-1 through E-9);

  • a warrant officer (W-1 through W-4); or

  • a commissioned officer (O-1 through O-10).

Within a pay grade, pay levels vary according to the number of years of service.

17. Privatized Housing

Military bases enter into privatization agreements with private companies to provide housing for military personnel. Under privatization, the private company builds or renovates military housing and makes it available for rent to service members. The rent is limited to the service member's BAH. Privatized housing may be on the military base or off the base. Because privatization agreements are developed locally by military bases, they may be referred to under different names. Some are called “Public/Private Ventures.”

18. Save Pay

Save pay is a special pay provision that allows military members, under certain circumstances, to retain entitlement to amounts of pay and/or allowances authorized under prior laws or for a lower grade from which promoted.

19. Special and Incentive Pay

Special and incentive pay is compensation to specific groups of uniformed people for inconveniences or hazards, or provides incentives for those with skills in high demand to join or remain in the service. Special pay includes:

  • enlistment and reenlistment bonuses;

  • flight pay;

  • sea pay; and

  • more than 30 additional types of pay.

Special and incentive pay is usually subject to income taxes but is not subject to FICA tax.

20. Uniformed Services

The Uniformed Services are defined by law and include:

  • Army;

  • Navy;

  • Air Force;

  • Marine Corps;

  • Coast Guard;

  • Reserve and National Guard components of the above;

  • Public Health Service commissioned officer corps; and

  • National Oceanic and Atmospheric Administration (NOAA) commissioned officer corps.

C. Process - How the Pay System Works

1. Forms of Compensation

Compensation to members of the Uniformed Services takes several forms, chiefly:

  • basic (or base) pay;

  • special and incentive pay; and

  • cash allowances for subsistence (rations), clothing, and housing, and the in-kind provision of subsistence/housing.

    NOTE: Effective 03/09/2005, clothing is not counted as in-kind support and maintenance.

2. Amount of Compensation

The amount of compensation, depending on the form it takes, can vary with rank, length of service, location of duty station, family size, and other factors.

3. Paydays

a. First-of-Month Payday

All branches of the Uniformed Services pay full-time service members on the first day of the month for work performed in the previous calendar month. (For work performed prior to September 1987, however, most service members were paid on the last day of the work month. As a result, service branches often still refer to this payday as the end-of-the-month payday.)

b. Mid-Month Payday

All service branches (other than the Public Health Service) offer full-time members a mid-month payment as partial payment of the net amount due for the full calendar month. The mid-month payment is optional or standard, depending on the service branch:

  • Optional-Army and Air Force

  • Standard-Navy, Marine Corps, Coast Guard, and NOAA.

c. Casual Pay

While away from base, a service member can receive payment of pay and allowances due for the current month. This casual pay is issued at odd times of the month. Casual pay is not an entitlement. It is a manner of paying compensation that is already due.

d. Reserve and National Guard Paydays

Part-time service members are paid at different times depending on their periods of service.

4. Apportionment Between Paydays

a. First-of-Month Payday

The first-of-month payment represents all net compensation due for the work month less the amount paid earlier in the pay period.

b. Mid-Month Payday

The amount paid mid-month (if any) varies according to the rules of the service branch and rank of the service member, as illustrated in the following chart:

Amount Paid Mid-Month

Service Branch

Basic Pay, Special Pay And Allowances (Except Subsistence

Subsistence Allowance

Air Force

Navy

Marine Corps

Coast Guard

NOAA

One-half of net amount due for work month

One-half of the amount due for work month

Army

Optional percentage (up to 50 percent) of net amount paid for the month before the work month

One-half of the amount due for work month

5. Pay Slips

The service branches issue a single pay slip each month on or after the first-of-month payday. That pay slip shows the gross amount due for the full calendar month and the net amount issued on each payday of the month.

D. Policy

1. Basic Pay

Only basic pay (and CONUS COLA) constitutes wages.

2. Special Pay and Allowances

All special pay and allowances, except hostile fire pay, imminent danger pay, and, in deeming situations, other kinds of additional pay that may be received by military personnel serving in a combat zone are chargeable unearned income to the service member. (See SI 00830.540D.8.)

3. Hostile Fire Pay/Imminent Danger Pay

Hostile fire pay or imminent danger pay received in or after October 1993 is excluded from income. Any unspent hostile fire pay or imminent danger pay becomes a resource if retained into the following month and not otherwise excluded. See SI 00830.540B.13. for the definition of hostile fire pay/imminent danger pay. Hostile fire pay/imminent danger pay is included in the net pay on the LES.

4. Basic Allowance for Housing

A basic allowance for housing (BAH) is not income if:

  • the service member lives in free on-base housing, and

  • the allowance is paid and deducted in the same pay period. However, the shelter provided may result in ISM to the claimant. (See SI 00830.540B.5. and SI 00830.540D.5.)

5. Value of In-Kind Support and Maintenance (ISM)

Food or shelter received in kind by a service member or by the service member's family is ISM to all individuals who benefit. To determine the value of food or shelter received in kind, use the procedures for developing outside ISM (SI 00835.350).

6. Overpayments

a. Basic Pay

An overpayment of basic pay (wages) is income when received. Any amount deducted to recover a wage overpayment is not wages, regardless of when the overpayment occurred.

See SI 00830.540B.2. for a discussion of advance pay.

b. Allowances and Special Pay

An overpayment of an allowance or special pay, other than hostile fire pay or imminent danger pay, is chargeable income when received. Any amount deducted to recover an overpayment of an allowance or special pay is also income, unless double counting would result. Apply the policy in SI 00830.110 (regarding overpayments from other benefit programs) to amounts deducted to recover overpayments of allowances and special pay.

See SI 00830.540D.7. for the policy on retroactive adjustments of allowances and special pay, which are not considered overpayments.

See SI 00830.540B.2. for a discussion of advance pay.

7. Retroactive Adjustments

A retroactive adjustment in the type of pay or allowance, even if the change affects the amount due, is not an overpayment. Such retroactive adjustments are usually made in full in a single month. (SI 00830.540B.3. describes how these adjustments appear on the pay slips.) Only the net amount paid for a month in a category of allowance or special pay (e.g., all subsistence entitlements less all subsistence deductions) is income for the month.

See SI 00830.540D.6. for the policy on overpayments.

8. Additional Pay Received By a Deemor

Additional military pay (as defined in SI 00830.540B.1.) received by a deemor for months after September 2002 is excluded from parent-to-child and spouse-to-spouse deeming computations if:

  • the additional pay was received by the deemor as a result of deployment to or while serving in a combat zone; and

  • the deemor was not receiving the additional pay immediately prior to serving in a combat zone.

NOTE: Reservist Differential Pay is not excluded from income counting for SSI purposes. We treat these payments as earned income. See SI 00820.400B.11 for the definition of Reservist/Military Differential Pay.

9. Privatized Military Housing

When a service member lives in privatized military housing, and the military base directs a BAH to the housing contractor by way of a payroll deduction or allotment in order to provide housing, the BAH is counted as outside ISM under the PMV rule, not as cash unearned income.

The amount of the BAH will appear on the service member's LES. This amount is determined by the military based on the service member's rank, dependents, and housing costs in the local area.

Many military bases have not yet privatized and still provide service members with military housing. For these situations, we treat the military housing as rent-free shelter and count it as outside ISM under the PMV rule (SI 00830.540.B.5.).

Some service members live off base in completely private housing. For these members, we count the BAH as cash unearned income (SI00830.540B.5.).

10. Retroactive Military Pay and Deeming of Resources

Public Law 108-11 provided for an increase in hostile fire/imminent danger pay from $100 a month to $225 a month and also increased the family separation allowance from $100 to $250 a month. These pay increases were retroactive to October 1, 2002.

Effective for payments received after September 2002, for the 9-month period following the month of receipt, exclude from deemed resources the unspent portion of any retroactive payment of:

  • hostile fire and imminent danger pay (pursuant to 37 U.S.C. 310) received by the ineligible spouse or parent from one of the uniformed services; and

  • family separation allowance (pursuant to 37 U.S.C. 427) received by the ineligible spouse or parent from one of the Uniformed Services as a result of deployment to or while serving in a combat zone.

11. Child Support

When a deemor is paying court-ordered child support, such child support payment should first be deducted from the unearned income portion of the military pay. If more money needs to be deducted, then it is deducted from the base pay.

12. Transitional Compensation

Transitional compensation paid by the Department of Defense to abused family members of a service member who has been separated from the service because of the abuse is considered unearned income for SSI purposes.

E. Procedure - All Claims

1. General

  • Request LESs from the claimant or service member. If LESs are unavailable, make oral or written contact with the employer, per SI 00830.540E.7. and SI 00830.540E.8. If all else fails, take the service member's statement either signed or recorded on a DROC and proceed as explained in SI 00830.540E.6. Except as provided in SI 00830.540E.6., you need not document the reason for using one verification method rather than another.

  • Develop ISM from rent-free shelter per SI 00835.370. Remember that in-kind benefits do not always appear on pay records.

  • Ask the service member to estimate the amount and expected cash payment date of future clothing allowances. NOTE: Initial and replacement clothing allowances are paid annually.

  • Remember the need to consider retroactive adjustments of pay and allowances per SI 00830.540D.7. when determining chargeable income.

2. Hostile Fire Pay/Imminent Danger Pay

Hostile fire pay/imminent danger pay is included in the net pay on the LES. When individuals in the Uniformed Services have items on their LES that SSA excludes from income for SSI purposes, process the computations manually. Do not use the military wages PC program.

3. Additional Pay

Request the LESs for members of the Uniformed Services. If the LESs are not available, verify pay months per SI 00830.540E.

Identify additional pay received by members of the Uniformed Services.

Exclude additional pay when determining deemed income for SSI purposes, if

  • the additional pay was received as a result of deployment to or while serving in a combat zone,

  • the deemor was not receiving the additional pay prior to serving in a combat zone, and

  • the additional pay was paid for months after September 2002.

NOTE: Do not exclude increases in basic pay (e.g., COLAs, promotions). Do not exclude additional pay received while serving in a combat zone if the deemor was already receiving it immediately prior to serving in a combat zone.

Post income amounts to the SSI record (SSR), subject to the rules of administrative finality (see SI 04070.001).

Charge additional pay (except hostile fire/imminent danger pay) as unearned income (refer to SI 00830.540D.3.) for SSI purposes if

  • the additional pay was received for months before October 2002, or

  • the income was received between October 2002 and August 31, 2008 and the deemor was not serving in a combat zone when the additional pay was received.

Charge additional pay (except on-base housing/privatized military housing allowances and hostile fire/imminent danger pay, as described in SI 00830.540D.3. and SI 00830.540D.5.) as earned income if the income was received:

  • After August 31, 2008, and

  • The deemor was not serving in a combat zone when the additional pay was received.

If the pay is not specifically excluded per SI 00820.400C.3., treat the income as earned or in-kind support and maintenance (ISM), as appropriate.

4. Privatized Military Housing

When making determinations about a military service member's living arrangement(s):

  • Determine whether the service member lives in privatized housing using the member's LES or the field office's precedent for the base's housing.

  • Contact the base housing staff if there is a question as to whether the service member is in privatized housing.

  • If the member is in privatized housing, use the member's LES to verify the amount of BAH and that the BAH was deducted/allotted by the military base to pay rent directly to the private contractor.

  • If the LES is not available or it does not reflect the deduction/allotment for rent, ask the service member to provide other evidence or contact the base housing staff to verify the deduction/allotment for rent.

  • Divide the full amount of the BAH by the number of members in the service member's household to determine the actual value (AV) of ISM countable for the eligible individual.

  • Count the AV as ISM for the eligible individual up to the presumed maximum value (PMV).

  • Follow the rules for administrative finality in SI 04070.010. to reopen prior determinations if it appears that the BAH was counted as cash income instead of ISM for prior months.

If you have verified that the member is in privatized housing, but cannot verify that the BAH was subject to a deduction/allotment for rent, contact your Regional Office SSI staff for guidance.

NOTE: Regional Office staff should refer the case to the Office of Income Security Programs staff before counting BAH as cash for a service member living in privatized housing.

5. Retroactive Military Pay and Deeming of Resources

  • Develop the exclusion only if it would affect eligibility for regular or conditional SSI benefits, in that order.

  • Follow the instructions in SI 00830.540E. to determine the type and amount of the hostile fire/imminent danger and/or family separation retroactive payments.

  • Use the LES to determine the month of receipt or use the deemor's allegation of the month of receipt.

  • If excluded funds have been commingled with other funds, follow the instructions in SI 01130.700.

NOTE: Interest on the retroactive funds is not excluded. Follow instructions in SI 00830.500 to develop interest income.

If, after applying all applicable exclusions, retained military pay deemed from a parent or spouse who has been deployed to a combat zone would result in excess resources, contact your RO support staff for further instructions before taking any adverse action. RO support staff will contact Central Office for guidance on handling these cases.

6. Pay Slips - General

Whenever possible, use the individual's copy of an LES to verify the gross pay for a work month, including both earned and unearned income. Military personnel can access pay slips by using the Internet.

NOTE: In most cases, two checks are issued to pay the amounts due for the month, and these checks are issued in different months, as explained in SI 00830.540C.3.

7. Oral Statement of Employer

If LESs are not available, verify, if possible, the amounts of pay and allowances by telephone contact with the service member's Pay and Finance Office. Document the type of payment, amount, frequency, receipt date, contact person’s name and title and the date of the call. Document the file per GN 00301.285 through GN 00301.289.

8. Written Information from Employer

If LESs are not available and telephone contact with the employer is not productive, request pay information in writing as follows:

a. Request Information From Military Installation

  • Request information from the Pay and Finance Office of the service installation to which the service member is attached.

  • Ask the installation for copies of LESs for needed months in the period under review, unless the parallel office has developed other effective means of obtaining information.

  • Provide the installation with the beginning and ending dates of service if the member is no longer on active duty.

  • Determine monthly income per SI 00830.540E.SI 00830.540G.

b. Member's Installation Will Not Provide Information

  • Request the information from the National Pay and Finance Center for the member's branch of service. (Reserve components, other than the National Guard, are part of their service branches.)

  • Use the addresses and parallel Social Security offices in

  • SI 00830.540J.

NOTE: Since responses from the National Centers often take 30-45 days, make requests to them only when the service member's base will not cooperate.

9. Statement

If other methods of verifying basic pay, special pay, and allowances are unproductive, obtain the service member's statement either signed or recorded on a DROC of the amounts. Document the file per GN 00301.285 through GN 00301.289.

F. Procedure - For Benefits Payable On or After June 1, 2004

NOTE: To determine benefits payable for June 2004, apply this procedure to the income received in the budget month (usually 2 months prior), even if the budget month is prior to June 1, 2004. For eligibility determinations, apply this procedure to the income received in months on or after June 1, 2004.

For the first month that the change is effective (budget month), use the total income shown on the LES even if part of that income was used in a prior month's computation.

1. Pay Slips - All Branches of Uniformed Services

Determine how much earned and unearned income is chargeable for each month.

  • The total base pay shown on the LES is earned income for that month.

  • The total allowances shown on the LES are unearned income for that month (unless otherwise excluded, such as hostile fire pay).

2. Example

  • Karen Dean is an SSI recipient married to Ken Dean, an enlisted person in the Air Force.

  • The couple lives in off-base non-privatized housing.

  • Mr. Dean is paid twice a month. Mr. Dean's LES for June 2004 shows the following gross entitlements:

  • base pay - $808.80

  • housing - $253.20

  • rations - $166.47

  • variable housing allowance (VHR) - $34.14.

  • Mr. Dean's earned income for June 2004 is $808.80.

  • Mr. Dean's unearned income for June 2004 is $453.81 ($253.20 + $166.47 +$34.14).

G. Procedure - For Benefits Payable Prior to June 1, 2004

1. Basic Allowance for Subsistence

Divide the monthly Basic Allowance for Subsistence (BAS) in half to determine the BAS paid mid-month and the first of the next month. This applies to all service members of all branches of military service.

2. Pay Slips - General

Determine how much earned and unearned income is chargeable to each payday. Use the charts in SI 00830.540G.3. and SI 00830.540G.4. unless evidence indicates another method would be more appropriate. If you use another method, document the reason in file. Carry all calculations three digits to the right of the decimal point, per SI 02001.010. Drop the fourth and any other digits and do not round up. See SI 00830.540G.4. for an example of the use of an LES in dividing gross pay between paydays.

3. Pay Slips - Army

Use this chart to determine how much earned and unearned income from Army pay is chargeable to each payday.

Step

Action

1

Divide the mid-month payment by the total net pay for the work month to calculate the fraction of pay and allowances paid mid-month.

2

Multiply the result of step 1 by the basic pay for the work month to calculate wages paid mid-month.

3

Subtract the result of step 2 from the basic pay for the work month to calculate wages paid the first of the next month.

4

Add up all other pay and allowances for the work month.

5

Multiply the result of step 1 by the result of step 4 to calculate the amount of unearned income paid mid-month.

6

Subtract the result of step 5 from the result of step 4 to calculate the amount of unearned income paid the first of the next month.

4. Pay Slips - Non-Army

Use this chart to determine how much earned and unearned income from non-Army pay is chargeable to each payday.

To see the procedure illustrated, refer to the example in the right column of the chart below (and in the completed worksheet in SI 00830.541D.), which is based on the following case facts:

  • Karen Dean is an SSI recipient married to Ken Dean, an enlisted person in the Air Force.

  • The couple lives in off-base non-privatized housing (e.g., so the BAH is counted as cash income).

  • Mr. Dean is paid twice a month. Mr. Dean's LES for October 1992 shows the following (gross) entitlements:

  • base pay—$808.80

  • housing—$253.20

  • rations—$166.47

  • variable housing allowance (VHA)—$34.14

  • The LES shows a mid-month (October 15) net payment of $564.02 and a first-of-month (November 1) net payment of $569.39.

NOTE: In the example, the results of steps 6 and 11 below provide the gross wages and unearned income paid October 15. The results of steps 7 and 12 provide the gross wages and unearned income paid
November 1.

STEP

ACTION

EXAMPLE

1

Divide the total subsistence (i.e., rations) allowance for the work month in half to calculate the subsistence allowance paid mid-month and the first of the next month.

$166.470

divided by 2

$83.235

2

Subtract the result of step 1 from the net amount paid mid-month to calculate the total nonsubsistence pay (i.e., special pay and allowances for housing and clothing) issued mid-month.

$564.020

-83.235

$480.785

3

Subtract the result of step 1 from the net amount paid first-of-month to calculate the total nonsubsistence pay for the work month.

$569.390

-83.235

$486.155

4

Add the result of steps 2 and 3 to calculate the total net nonsubsistence pay for the work month.

$480.785

+486.155

$966.940

5

Divide the result of step 2 by the result of step 4. The result is the fraction of basic pay, special pay, and nonsubsistence allowances paid mid-month.

$480.785

divided by

966.940

.497

6

Multiply the result of step 5 by the basic pay for the work month to calculate wages paid mid-month.

$808.800

x .497

$401.973

7

Subtract the result of step 6 from the basic pay for the work month to calculate wages paid the first of the next month.

$808.800

-401.973

$406.827

8

Add up all BAH, other pay, and VHA for the work month, except for subsistence.

$253.200

+34.140

$287.340

9

Multiply the result of step 5 by the result of step 8 to calculate the nonsubsistence unearned income paid mid-month.

$287.340

x .497

$142.807

10

Subtract the result of step 9 from the result of step 8 to calculate the nonsubsistence unearned income paid the first of the next month.

$287.340

-142.807

$144.533

11

Add the results of steps 1 and 9 to calculate the total unearned income paid mid-month.

$83.235

+142.807

$226.042

12

Add the results of steps 1 and 10 to calculate the total unearned income paid the first of the next month.

$83.235

+144.533

$227.768

H. References

CATEGORY

ABBREVIATION

MEANING

Clothing

BCRA

Clothing allowance

 

CCA

Civilian clothing allowance

 

CLOTHING

Clothing allowance

 

CLOTHING ALW

Clothing allowance

 

CLOTHING SPECIAL

Clothing allowance

 

CMA

Clothing allowance

 

CRA

Clothing allowance

 

EXTRA CLOTHING

Clothing allowance

 

FCRA

Clothing allowance

 

SCRA

Clothing allowance

 

UNIF

Clothing allowance

Housing

ASHA

Advance housing allowance

 

AVHA

Advance housing allowance

 

BAH

Basic allowance for housing (combines basic allowance for quarters (BAQ) and VHA)

 

DUAL OHA

Dual overseas housing allowance

 

FSBAQ

Family separation BAQ

 

IHA

Interim overseas housing allowance

 

INADQTR

Inadequate quarters allowance

 

MISH MISC

Move in housing allowance--miscellaneous

 

MIHA RENT

Move in housing allowance -- rent

 

MIHA SECURITY

Move in housing allowance -- security

 

OHA

Overseas housing allowance

 

RENT COL

Payroll deduction for rent

 

SHA

Station housing allowance

 

TLA

Temporary lodging allowance

 

TLE

Temporary lodging expense

 

VHA

Variable housing allowance

Special Pay

ACIP

Aviation career incentive pay

 

ACP

Aviator continuation pay

 

BRD CRT NON-PHYS

Board certified non-physician

 

BRD CRT PHYS/DENT

Board certified physician/dentist

 

CEFIP

Career enlisted flight incentive pay

 

CONTINUATION PAY

Medical continuation pay

 

CRP

Command responsibility pay

 

CRSC

Combat related special compensation for certain combat-related disabled uniform services retirees

 

CSP

Career sea pay

 

CSPP

Career sea pay premium

 

DEMO PAY

Demolition duty pay

 

DISABILITY SEV

Disability severance pay

 

DISCHARGE GRAT

Discharge gratuity

 

DIVE

Dive pay

 

EB

Enlistment bonus

 

ESB

Engineering scientific bonus

 

FDP

Foreign duty pay

 

FITW REFUND (CZ)

Federal income withholding refund (combat zone)

 

FLPP

Foreign language proficient pay

 

FSA, FSH

Family separation allowance

 

HDIP

Hazardous duty incentive pay

 

HDP-L

Hardship duty pay for location

 

HFP

Hostile fire pay

 

HFP/COMBAT ZONE

Hostile fire pay (combat zone)

 

HSTL

Hostile fire pay

 

IDP

Imminent danger pay

 

NUC OFF ACC BONUS

Nuclear officer accession bonus

 

O/S EXN PAY

Overseas extension pay

 

PCS

Advance pay for permanent change of station

 

PROFICIENCY PAY - OTHER

Foreign language proficiency pay

 

PROPAY

Superior performance pay

 

READJUST PAY

Readjustment pay

 

REF SOC SECURITY

Refund social security

 

REFUND AFRH (USSH)

Refund armed forces retirement home (U.S. soldiers home)

 

REFUND FITW

Refund federal income tax

 

REFUND MGIB

Refund Montgomery GI bill

 

REFUND SITW

Refund State income tax withholding

 

RELSD HLD PAY

Released held pay

 

RN ACCES BONUS

Registered nurse accession bonus

 

RRB

Regular reenlistment bonus

 

SAVE PAY

Used to pay additional entitlements due to rank change and to pay entitlements that are not programmed yet. Hardship pay.

 

SDP

Submarine duty pay

 

SEB

Selective enlistment bonus

 

SITW REFUND (CZ)

State income tax refund (combat zone)

 

SPEC DUTY
PAY/SDAP

Special duty assignment pay

 

SRB

Selective reenlistment bonus

 

VRB

Reenlistment bonus

 

VSI/SSB

Voluntary separation incentive/special separation benefit

 

VSP PHYS

Variable special pay - physician

SUBSISTENCE

BAS

Basic allowance for subsistence

 

BAS DISC MEAL RATE

Basic discounted meal rate

 

CMAI INITIAL

Civilian maintenance allowance - initial

 

COMRATS

Commuted rations (BAS)

 

EMR

Rations allowance

 

FLD RAT

Rations allowance

 

FLDRE

Rations allowance

 

FSSA

Family subsistence supplemental allowance

 

GEN OFF PMA

General officer personal money allowance

 

LR

Rations allowance

 

LV RATS

Rations allowance

 

RATS-LV

Rations allowance

 

RATS-SEP

Rations allowance

 

SEP RATS

Rations allowance

 

SR

Rations allowance

 

SUP/PRO RATIONS

Supplemental and prorated BAS rations

 

UEA ADDITIONAL

Uniform and equipment allowance additional

 

UEA INITIAL

Uniform and equipment allowance initial

MISCELLANEOUS

ACLVN

Accrued leave (unearned income)

 

ACLVT

Accrued leave (basic pay)

 

AFRH

Armed forces retirement home

 

AP (APA)

Advance pay (and allowances)

 

BASE PAY

Basic pay

 

BP

Basic pay

 

COLA

Cost of living adjustment

 

COLA DUAL

Cost of living adjustment - dual

 

COLA
PRORAETED

Cost of living adjustment - prorated

 

CONUS COLA

Continental United States cost of living adjustment

 

DIC

Dependency and indemnity compensation

 

DLA

Dislocation allowance

 

EOM

End-of-month payment (actually paid on the first day of the next month)

 

MALT

Monetary allowance in lieu of transport

 

MM MID-MO PMT

Mid-month payment

 

PERS EXP

Personal expense

 

SGLI

Servicemembers’ group life insurance

 

SPO

Split pay option

 

TC

Transitional compensation

 

USSH

U.S. soldier’s home (charitable deduction)

I. List of National Pay and Finance Centers

Service Branch

Facility Address

Parallel Field Office

Air Force

Air Force Military Pay Operations

DFAS-IN/JFL

8899 East 56th Street

Indianapolis, IN 46249--1200

Aurora, CO B.O. (D24)

Army

USAFAC, CMDR

Social Security Sections

Centralized Pay Operations

Fort Benjamin Harrison

Indianapolis, IN 46249-0865

Indianapolis, IN D.O. (455)

Coast Guard

Commandant

U.S. Coast Guard

Washington, D.C. 20593

Washington (M Street),
D.C. D.O. (270)

Marine Corps

Centralized Pay Division

Marine Corps Finance Center

2500 East Bannister Road

Kansas City, MO 64197

Kansas City (South), MO D.O. (736)

National Guard

See RS 01404.315 for address and parallel field office

 

National Oceanic and Atmospheric Administration

Commissioner Personnel Division

NCI

Rockwall Building, Room 115

Department of Commerce, NOAA

Rockville, MD 20852

Rockville, MD B.O. (A33)

Navy

Navy Finance Center

1240 E. 9th Street

Anthony J. Celebrezze Building

Cleveland, OH 44199

Cleveland (Downtown), OH D.O. (388)

Public Health Service

U.S. Public Health Service

Employment Operations Branch

Commissioner Personnel Division

Park Lawn Building, Room 4-35

5600 Fishers Lane

Rockville, MD 20852

Rockville, MD B.O. (A33)

Coast Guard (Annuitants and Retirees)

United States Coast Guard

Pay and Personnel Center RP