Tax Free Questions

[Guest Bad Intel]

Are there any forms that finance will need filled out to start my entitlements and tax free deal while deployed? They have not started any of it despite being on Balad for over a month, and there open hours are during my normal sleeping hours (they dont work weekends or holidays and they are closed by 1800). I remember filling out some forms when I arrived here, but I had to give them to some Army dudes to take over (working with the Army here) to finance and imagine they got lost somewhere in the chain of people.

BTW...Had my first C-130 ride from the Deid to Balad, was not to bad. Sleeping on the pallet was kinda nice.

[Finance_Guy]

Are there any forms that finance will need filled out to start my entitlements and tax free deal while deployed? They have not started any of it despite being on Balad for over a month, and there open hours are during my normal sleeping hours (they dont work weekends or holidays and they are closed by 1800). I remember filling out some forms when I arrived here, but I had to give them to some Army dudes to take over (working with the Army here) to finance and imagine they got lost somewhere in the chain of people.

BTW...Had my first C-130 ride from the Deid to Balad, was not to bad. Sleeping on the pallet was kinda nice.

The key to getting entitlements started is to make sure you in-process with PERSCO (Air Force). They then load you to DCAPES and then pull a file to upload all the start transaction--this is for IDP/CZTE only. I know a finance dude there at Balad so PM me and I can give you details. You could probably shoot an email and he can hook you up. There's really no forms to fill out for CZTE but you will need to fill out forms for FSA. If your home station is using eFinance, you can do your FSA start online but will need to fax/upload a copy of your orders to the submission.

[JeepGuyC17]

Not entirely true. You must be "assigned" to the airspace, i.e. airdrop, AWACs, or refueling etc. Merely transiting the airspace does not qualify. DODFMR vol. 7A provides more details.

https://www.defenselink.mil/comptroller/fmr/07a/07a_44.pdf

440103.C.4

"...The fact that most members are in an official duty status when flying through a designated airspace should not be construed to mean they are assigned to the airspace to perform duty and therefore entitled to the exclusion."

Every time I've flown in the combat zone we've been on the Air Tasking Order. Does that satisfy the criteria of being assigned to the airspace?

[Finance_Guy]

Every time I've flown in the combat zone we've been on the Air Tasking Order. Does that satisfy the criteria of being assigned to the airspace?

I don't really know what an Air Tasking Order tells you to do. But if it's just to fly from point A to point B where both points are outside designated CZs, then I'd say you are not assigned TDY to the airspace. Here's an example from the DoDFMR:

Example 1. Member A is assigned as a navigator in an air unit stationed outside the combat zone. On June 4, during the course of a flight between his home base and another base outside the combat zone, the aircraft on which he serves as a navigator flies over a combat zone (given that the airspace is part of the designated combat zone). Member A is not on official temporary duty in the airspace of the combat zone and does not qualify for hostile fire or imminent danger pay as a result of the flight. Accordingly, he is not deemed to have served in a combat zone since he passes through the zone without either being on official duty to the combat zone or qualifying for hostile fire or imminent danger pay.

Now if this ATO assigns you to a specific airspace to refuel other birds, then I'd say you qualify. Or other air support cover for ground troops. For most this isn't a big issue since they usually either depart or arrive some other CZ area where they qualify for being on ground in that area.

[Finance_Guy]

There's really no forms to fill out for CZTE but you will need to fill out forms for FSA. If your home station is using eFinance, you can do your FSA start online but will need to fax/upload a copy of your orders to the submission.

I wanted to add the nugget below since it relates to getting FSA started on deployments. Seems there are home station finance offices that are not clear on the process. Below lays it out--edited for public viewing. Thanks.

Word from the desert: Deployed finance office are being asked to notify the servicing FSOs when members have been in the desert for more than 30 days so that the servicing can request the FSA-T starts. AFMAN 65-116, V1, chapter 27, requires the servicing FSO (Home Station) to start the FSA for members on orders for more than 30 days.

The Pay system (DJMS-AC) will recycle the FSA Start (6501) until the member has been gone for the required period, then pay retro to the date of departure from the PDS. This eliminates the need for the manual suspense/notification from the desert. Of course, that can’t be done without the member coming into the FSO prior to departure and completing the portion of the DD Form 1561 that can be accomplished at departure. Unfortunately, we are being told that many FSOs are telling members they can’t request or process the transactions upon departure and that they must wait for notification from the desert that the member has been there for more than 30 days.

Please ensure that your folks are following the guidance in chapter 27; this will eliminate some unnecessary notification requirements for the desert and get the entitlement started for all members who come into finance before they depart. If the member doesn’t work the FSA start with the homestation finance, then those members will most likely wait until they return from TDY to get their FSA.

...From a reliable source.

[noodles]

https://www.af.mil/news/story.asp?id=123172674

"Congress finishes work on authorization bill"

"The bill authorizes payment of hostile fire pay, imminent danger pay, hazardous duty pay, assignment pay and skill incentive pay to be prorated to reflect actual qualifying service performed during the month"

From the 2010 NDAA:

"Section 618—Proration of Certain Special and Incentive Pays to Reflect Time During Which a Member Satisfies Eligibility Requirements for the Special or Incentive Pay

This section would clarify that the monthly payment of hostile fire pay, imminent danger pay, hazardous duty pay, assignment pay, and special duty pay may be prorated to reflect the actual time the service members performed qualifying service during the month. This section would also clarify that reserve members may be paid a skill incentive bonus in the same manner as such a bonus is paid to active duty members and that the monthly payment of the bonus may be prorated to reflect the actual time served in a critical skill."

So...this means that if you leave the AOR on 2 October you'll only get 2 days of IDP/HFP. Anyone care to guess tax free is falling under this categoy?

[Finance_Guy]

https://www.af.mil/news/story.asp?id=123172674

"Congress finishes work on authorization bill"

"The bill authorizes payment of hostile fire pay, imminent danger pay, hazardous duty pay, assignment pay and skill incentive pay to be prorated to reflect actual qualifying service performed during the month"

So...this means that if you leave the AOR on 2 October you'll only get 2 days of IDP/HFP. Anyone care to guess tax free is falling under this categoy?

We asked this question to AF Accounting and Finance Office who ran it up to DFAS. Here's what DFAS replied back with:

"The original FY 2010 NDAA did contain a proposal to prorate IDP, HDIP, and Assignment or Special Duty Pay. From the history of the NDAA on-line, it appears that this section (was sec 618 of HR 2647, the FY 2010 NDAA), was still included in the version of the Bill passed by the House, but was removed when the Bill went to Conference with the Senate. Sec 618 is now stop-loss...so appears the proposal to prorate IDP, HDIP, etc., is dead (for now)."

So no changes for now. HDIP is already prorated so there's really no change there. But HFP/IDP is paid at $225 for the entire month even if in the area for 1 day. But again, no changes for now.

[BigFreddie]

Thanks for the clarification Finance Guy... I was getting an intel/tactics briefing and this was the big topic. I'm glad you squared us away on it. If you get anymore info please let us know!

BF

Here is another somewhat related question...

A friend of mine tells me there is a table within DTS that states that transient aircrew are able to claim a special exemption downrange and get $50 a day per diem at all locations. He said there is a table and this is note #4 in the table. Can you confirm or deny this? I'm trying to get the time with him to see where this mythical table is at.

[Finance_Guy]

Here is another somewhat related question...

A friend of mine tells me there is a table within DTS that states that transient aircrew are able to claim a special exemption downrange and get $50 a day per diem at all locations. He said there is a table and this is note #4 in the table. Can you confirm or deny this? I'm trying to get the time with him to see where this mythical table is at.

Never heard of such table. As for per diem when downrange, AFCENT reporting instructions would trump any other previously published guidance or myths (such as a flying crew chief always getting full per diem). I've yet to find that in the JFTR or other AFI.

[Guest mentor34]

A rumor is spreading at our base that the rules have changed for combat zone income tax exclusion calculations. Soon to be for the actual days in the zone, not just each month that your "stay" touched. Can anyone verify/corrobarate this? Perhaps the extra income will pay for universal health care and the extended TARP benefits...

Edited December 12, 2009 by M2

[Napoleon_Tanerite]

very doubtful unless it is coming from the congressional level-- how many generals do you think would willingly give up their tax free months for their one day trips to the AOR?

[Techsan]

Sucks to be a C-5 crewdawg

I think you still get the tax-exclusion, as always, however I think its just the hostile fire pay ($225) that is being prorated. C-5 bubbas are gonna have to sell their Beemer's & Benz's soon!

[flyguy2181]

very doubtful unless it is coming from the congressional level-- how many generals do you think would willingly give up their tax free months for their one day trips to the AOR?

according to air force times.....

The Defense Auth. Act signed by Obama on Oct 28.... monthly payment of hostile fire pay, imminent danger pay, hazardous duty pay, assignment pay and special duty pay will be prorated to reflect the actualy number of days in a month that a member performed qualityfing service.

Effective Oct 28 but new regulations must be issued

So long good deal trips, double cha-chings, takin' care of intel dudes working at incirlik & ramstein, etc etc ec

Don't know about the tax free issue...

Edited December 10, 2009 by flyboy2181

[BigFreddie]

Just checking in to see if anything has changed with this...

The latest rumor mill gossip is that finance is looking for a way to pro rate hostile fire pay and once that happens some of us will only get the days actually in the AOR. Just wondering if there is any truth to this or if there has been some new ruling since Finance Guy last posted...

BF

[JeepGuyC17]

Any word on whether they are thinking about prorating CZTE as well?

[Finance_Guy]

Just checking in to see if anything has changed with this...

The latest rumor mill gossip is that finance is looking for a way to pro rate hostile fire pay and once that happens some of us will only get the days actually in the AOR. Just wondering if there is any truth to this or if there has been some new ruling since Finance Guy last posted...

BF

No word on this yet. And guys, it's not finance who make entitlement policy, it' the personnel community--specifically the Under Secretary of Defense for Personnel and Readiness. This change would have to be approved/directed by Secretary Gates.

Read more here: https://militarypay.defense.gov/

[Day Man]

quick question...read through the DoD reg and couldn't find anything. is it local time or zulu time for being "in country?"

(even though it probably won't matter with the surge)

[tunes]

so to clarify, the entire month will still be tax free its just the Hazard Duty, Hostile Fire that are being pro-rated?

[Guest Rubber_Side_Down]

I've always used local time/date.

I think it's local. I remember one time when we got into theater on the last day of the month, and the big deal was that our 781 "proved" we landed on the ground 10 minutes prior to midnight (local time,) which means we got that entire month tax-free, with 10 minutes to spare.

[Herk Driver]

I think it's local. I remember one time when we got into theater on the last day of the month, and the big deal was that our 781 "proved" we landed on the ground 10 minutes prior to midnight (local time,) which means we got that entire month tax-free, with 10 minutes to spare.

IIRC, vouchers are indeed filed in local time.

[pawnman]

Just remember to get the tax free turned off when you get home. One of my buddies, despite repreated visits to finance to correct this problem (each time he was told "No, you're LES is right, don't worry about it"), just had $2500 in federal taxes taken out of one paycheck. And our finance office didn't even have the courtesy to pick up a phone or send an email before taking 90% of his paycheck.

[pawnman]

Hope your friend was smart enough to send the extra cash to a savings account instead of spending it. Happened to me twice and got the same answer from finance.

I visited them and told them what was wrong and they still fucked it up. But when they came calling for their money back, I was ready to simply write them a check and get them out of my LES rather than pay the money back over 6 months.

They didn't give him the option for a check or paying back over six months...or even a phone call. They just took it all out of his LES in one lump sum, with no warning.

[Guest Crew Report]

They didn't give him the option for a check or paying back over six months...or even a phone call. They just took it all out of his LES in one lump sum, with no warning.

I was always told if you owed the Air Force (excess family sep, hostile fire, etc) DFAS will take some time to collect it back because they have to notify you through a letter/email which will tell you different options on paying it back. If you owe back taxes due to overpayment that comes out automatically and finance doesn't have control over when it comes out of your paycheck.

Edited May 3, 2010 by Crew Report

[Jughead]

All the other posts appear correct. You may want to Check in AFI-65-116 Vol 1, chapter 44 for references.

THREAD REVIVAL (closest post I could find to my question)

So, tax exempt leave. Didn't see the answer in 65-116 referenced above. I do see in DoD 7000.14-R, VOLUME 7A, CHAPTER 35 the details about selling leave back, but not using it as part of ordinary leave.

Q) Does the officer limitation to tax-exempt pay render tax exempt leave meaningless to anyone over the limit?

Say you earn 5 days of leave deployed in Jan & Feb to a CZTE area; those 5 days show up as "tax exempt leave." Now you take 5 days of leave in (say) July, and you don't otherwise have any CZTE that month. I gather from reading here & elsewhere that you would expect to have 5/30ths of your taxable pay be tax-free for that month (or perhaps it's 5/365ths of your annual pay?). Yes/no? In my situation (exceed the officer limit), that doesn't seem to be happening, which makes me speculate....

In other words, if you exceed the limit in January & February (when the leave was earned), has it already "used up" its tax free value when you take it, even in July (when the 5/30ths deduction would not exceed the limit)?

[Jaded]

Yes, you'd get 5/30 days tax free if you used 5 days of tax free leave.

Remember though, that leave is used in a first in, first out method of accounting. Looking at your example again, you'd have 5 days of tax free leave from Jan/Feb, and then 10 days of normal leave from Mar/Apr/May/Jun. If you took 5 days of leave in July, you'd be using 5 days of *normal* leave (Jun/May), and would have 5 days of normal leave (Apr/Mar) and 5 days of tax free leave remaining (Feb/Jan).