TN 11 (01-15)

RS 01701.001 Military Pay Coverage and Deemed Military Wages (DMW)

A. History of coverage

Military pay became covered wages under Social Security effective 1/1/1957. Since military wages were usually lower than wages for an individual in similar civilian employment, Congress created DMWs in 1968 to lessen the wage gap.

NOTE: Before 1957, Congress granted veterans with active United States military service from 9/16/1940 through 12/31/1956 noncontributory wage credits of $160 per month. Refer to the archived military service POMS for more information on pre-1957 military service wage credits.

IMPORTANT: For Supplemental Security Income (SSI) purposes, only military basic pay is wages. DMW’s are not income. For more information on the SSI treatment of military pay, see SI 00830.540.

B. History of DMWs

1. Beginning 1968

Congress granted noncontributory DMWs of $100, $200, or $300 per quarter depending on entitlement date. DMWs provided coverage wage credits in addition to the basic pay members of the military received for active duty service or active duty for training. DMWs were subject to the maximum earnings limitation, but the military member did not pay Federal Insurance Contribution Act (FICA) taxes on the added DMWs.

DMWs are creditable for quarters of coverage (QC) and primary insurance amount (PIA) computations for any month of entitlement after 1967 or lump sum death payments (LSDP) for deaths after 1967. For information on the Railroad Retirement Board (RRB) exception, see RS 1701.001.D.1. in this section.

2. Beginning 1973

Congress increased DMWs of $100 and $200 for 1968 through 1972 to $300 and extended DMWs of $300 per quarter for any amount of covered military pay back to 1957. However, DMWs are not creditable for QC and PIA purposes for any month of entitlement or LSDP for deaths prior to 1968.

3. Beginning 1978

Congress granted noncontributory DMWs of $100 for each $300 of posted annual military pay, not to exceed $1,200 per calendar year. DMWs cannot increase total yearly earnings beyond the maximum earnings subject to the FICA tax. Service members who enlisted after 9/7/1980 must meet minimum service requirements to receive DMWs. For more information on these requirements, see RS 01701.001C in this section.

4. Beginning 1988

Wages paid for Reserve and National Guard inactive duty service (periodic weekly or monthly drills or meetings) became covered wages for Social Security purposes. However, we do not grant DMWs for inactive duty pay.

5. Beginning 2002

Congress eliminated DMWs for members of the uniformed services for all years after calendar year 2001. We continue to grant DMWs for periods prior to calendar year 2002.

C. Requirements for receiving DMWs

A beneficiary who receives covered military wages as a member of a uniformed service on active duty service or training for the years 1957 through 2001 is usually entitled to DMWs. However, enlisted service members (non-officers) who entered on active duty after 9/7/1980 must meet minimum service requirements. For definitions of uniformed service member and active duty, see RS 01901.480C.

1. Enlistments from 9/8/1980 through 10/13/1982

Do not grant DMWs to enlisted service members discharged or released from active duty before completing the shorter of:

  • 24 months of continuous active duty; or

  • the full period of a shorter enlistment that the service member was ordered to serve.

EXCEPTIONS: Entitlement to DMWs remains if the service member was:

  • discharged or released from active duty due to hardship under section 1173 of title 10 of the U.S. Code;

  • discharged or released from active duty "for the convenience of the government" under section 1171 of title 10 of the U.S. Code;

  • discharged or released from active duty for a disability incurred or aggravated in the line of duty; or

  • found to have died during the period of enlistment.

2. Enlistments from 10/14/1982 through 12/31/2001

When entry on active duty occurred after 10/13/1982, do not grant DMWs if the enlisted service member fails to complete the shorter of:

  • 24 months of continuous active duty; or

  • the full period of a shorter enlistment that a service member was ordered to serve.

EXCEPTIONS: Entitlement to DMWs remains if the service member:

  • meets any exception listed in RS 01701.001C.1.;

  • previously completed a period of active duty lasting at least 24 months; or

  • was discharged from a prior period of active duty under section 1171 of title 10 of the U.S. Code.

D. Other Federal agency use of military service

1. Railroad Retirement Board (RRB)

If the RRB determines that the active duty service after 1956 is creditable under the Railroad Retirement Act:

  • do not consider the military pay to be covered employment for insured status and PIA computations; and

  • delete all previously posted military wages and DMWs from the earnings record.

For more information on deleting military wages and DMWs, see RS 01601.450.

2. Office of Personnel Management (OPM)

OPM may or may not use covered military service for annuity longevity purposes. OPM’s credit of military service after 1957 does not affect Social Security benefits. If you receive an inquiry about OPM’s use of covered military service, tell the inquirer to contact OPM for an explanation as instructed in RS 01702.356.

E. References


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0301701001
RS 01701.001 - Military Pay Coverage and Deemed Military Wages (DMW) - 10/23/2015
Batch run: 02/19/2016
Rev:10/23/2015