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1 [1] (January 2, 2018)

handle is hein.crs/crsmthmbdop0001 and id is 1 raw text is: Congressional Research Service Informn'g the legislative de[bate sir ce 1914 0 January 2, 2018 Defense Primer: Regular Military Compensation Congress sets compensation levels for memb armed forces through statutory authorizations appropriations. When people talk about military pay, they ar referring to basic pay. Although basic pay largest component of cash compensation that servicemember receives, there are other types pay and allowances that add significantly to 1 benefits as well. Regular Military Compensat a statutorily defined measure of the cash or if compensation elements which all servicemen every payday. It is widely used as a basic me military cash compensation levels and for co civilian salary levels. For 2017, a mid-grade enlisted servicemer received an annual average of $34,401 in b an average of $63,321 in RMC. Regular Military Compensation RMC, as defined in law, is the total of the ft elements that a member of the uniformed ser or receives, directly or indirectly, in cash or i payday: basic pay, basic allowance for housi allowance for subsistence, and federal tax ad' accruing to the aforementioned allowances b not subject to federal income tax. Military c structured much differently than civilian corn making comparison difficult. RMC provides complete understanding of the cash compens to all servicemembers and therefore is usuall, over simple basic pay when comparing milita civilian compensation, analyzing the standar military personnel, or studying military comr trends over time. Basic Pay For most servicemembers, basic pay is the lai of the compensation they receive in their pay typically accounts for about two-thirds of an RMC. All members of the Armed Forces rec although the amount varies by pay grade (ran service (also called longevity). Table 1 provi examples of basic pay rates. Basic Allowance for Housing All servicemembers are entitled to either gov provided housing or a housing allowance. Ab servicemembers receive government-provide the form of barracks, dormitories, ship berthi ers of the and e often only is normally the government-owned family housing). The remainder receive a housing allowance to offset the costs of the housing they rent or purchase in the civilian economy. For those living in the United States, this allowance is known as Basic Allowance for Housing (BAH). a The amount of BAH a servicemember receives is based on s of military three factors: paygrade (rank), geographic location, and t, and tax whether the servicemember has dependents. Paygrade and tion (RMC) is dependency status are used to determine the type of n-kind accommodation-or housing profile-that would be ibers receive appropriate for the servicemember (for example, one- asure of bedroom apartment, two-bedroom townhouse, or three- nparisons with bedroom single family home). Geographic location is used to determine the average costs associated with each of these housing profiles. The average costs of these housing profiles are the basis for BAH rates, with some additional nber (E-5) adjustments made on the basis of paygrade (that is, an E-7 )asic pay, but without dependents will receive more than an E-6 without dependents, even though the appropriate housing profile for both of them is two bedroom apartment). As a result of this methodology, BAH rates are much higher in some areas than others. The intention is that servicemembers of (RMC) similar paygrade and dependents status are able to pay for )lowing roughly comparable housing regardless of their duty vices accrues location. Table 1 provides illustrative examples of annual n kind every BAH. ng, basic vantage Basic Allowance for Subsistence ecause they are Nearly all servicemembers receive a monthly payment to ompensation is defray their personal food costs, known as Basic Allowance pensation, for Subsistence (BAS). BAS is provided at a flat rate. In a more 2017, enlisted personnel received $368.29 a month, while ation provided officers received $253.63 a month. Those who do not y preferred receive BAS-for example, enlisted personnel in basic try with training-receive government-provided meals. Is of living of ensation Federal Tax Advantage While the various types of military pay-basic pay, special pay, and incentive pay-are considered part of gross income and are usually subject to federal income tax, rgest element military allowances are generally not subject to federal check and income tax. The tax advantage generated by the exemption individual's of the housing and subsistence allowances from federal ive basic pay, income tax is a part of RMC. Table 1 provides the k) and years of estimated tax advantage for the illustrative examples, but des illustrative the precise value of the federal tax advantage for an individual servicemember will vary depending on his or her unique tax situation. ernment- Compensation Elements Not Included in RMC out 40% of Special pays and bonuses, travel reimbursements, d housing (in educational assistance, deferred compensation (i.e., an ng, or economic valuation of future retired pay and benefits), or any estimate of the cash value of non-monetary benefits wwwcrs.gov 1 7-5700

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