About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

GAO-04-721R 1 (2004-05-07)

handle is hein.gao/gaocrptaqgi0001 and id is 1 raw text is: SGAO Accountability * Integrity Reliability United States General Accounting Office Washington, DC 20548 May 7, 2004 The Honorable Charles E. Grassley Chairman The Honorable Max S. Baucus Ranking Minority Member Committee on Finance United States Senate The Honorable Mark Pryor United States Senate Subject: Military Personnel: Active Duty Compensation and Its Tax Treatment The Department of Defense's (DOD) total military compensation package for active duty members consists of both cash and noncash benefits. Since the late 1990s, Congress and the DOD have increased military cash compensation by increasing basic pay and allowances for housing, among other things. Military members also receive tax breaks, which are a part of their cash compensation. Moreover, active duty personnel are offered substantial noncash benefits, such as retirement, health care, commissaries, and childcare. In some cases, these noncash benefits exceed those available to private-sector personnel.' DOD relies heavily on noncash benefits because it views benefits as critical to morale, retention, and the quality of life for service members and their families. To better understand the military compensation system, you asked us to provide you information on active duty military compensation and its tax treatment. At the outset of this engagement, we agreed to keep you periodically informed of the status of our work. In January 2004, we briefed your staff on our preliminary observations. Because our work identified that the combat zone tax exclusion could impact some service members, you asked us to focus our work on military cash compensation and to do additional work to estimate the effect of the combat zone tax exclusion on service members' compensation. We provided your staff subsequent briefings that estimated the effect of the combat zone exclusion. As requested, we have updated and combined the briefings for this report to (1) summarize active duty cash compensation and describe how military compensation varies at different career 'U.S. General Accounting Office, Military Personnel: Active Duty Benefits Reflect Changing Demographics, but Opportunities Exist to Improve, GAO-0i2-935 (Washington, D.C.: Sept. 18, 2002). 2 The combat zone exclusion allows service members to exclude income earned for each month served in one of the 15 designated combat zones. Members who serve a minimum of 1 day in a combat zone are eligible to receive the combat zone exclusion for the respective month. For officers, the combat zone exclusion was limited to $5,958 per month in 2003. Enlisted members' exclusion is not limited. GAO-04-721R Military Compensation Page 1

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most