Preparing for deployment can be a challenging time for many reasons. Other than ensuring your family will be comfortable while you are away, your finances should rank as one of the important items on your pre-deployment checklist. Understanding what kinds of deployment pay you’re eligible for can help you and your family feel a bit more economically secure during a time of uncertainty.
What Are Deployment Entitlements?
Basic pay and allowances are only part of military compensation. While deployed, military servicemembers receive entitlements to partially compensate for the hardship, danger, and costs associated with that deployment. If you’re looking for a way to make the most of those entitlements and other benefits you’ve earned, certain AAFMAA products and services can help. .
What Deployment Pay Am I Entitled to?
Entitlements received during a deployment come in many different forms. They vary based on the specific location, conflict, and authorizations for that particular area. Your finance office can provide specific information for each deployment. However, the general categories and types of entitlements are as follows:
Hardship Duty Pay
Hardship Duty Pay (HDP) is a form of compensation provided to servicemembers who are deployed to locations or assigned to missions that involve exceptionally challenging conditions. It’s intended to recognize and provide extra support for the challenges faced by service members in locations where the quality of living conditions are substantially below the standard they would have in the continental United States. .
Servicemembers on deployment for more than 30 consecutive days will receive HDP. Rates are given monthly in increments of $50, $100, or $150, depending on the location or mission.
Hostile Fire & Imminent Danger Pay
Hostile Fire Pay (HFP) and Imminent Danger Pay (IDP) are additional compensations for personnel in high-risk areas due to war, terrorism, or civil unrest. These payments address the increased danger in such locations.
According to the U.S. Department of Defense (DoD), the key difference between the two is that HFP refers to harm from a specific hostile incident, while IDP is for those who are in a region that puts them in immediate danger. The Department of Defense determines which regions are eligible for IDP. HFP and IDP are both given at a rate of $225 per month.
Any amount of time spent in a hostile fire situation qualifies you for HFP, even if it’s just one day. To qualify for HFP, a servicemember must be:
- Subject to hostile fire or mine explosions
- In an area near hostile fire or mine explosions which endanger the servicemember
- Killed, injured, or wounded by hostile fire, mines, or any hostile action
To qualify for IDP, servicemembers must:
- Be on duty in a geographic location designated as eligible for IDP by the Department of Defense
- Receive official orders for temporary or permanent duty in the designated area
- Spend a minimum required time in the designated danger zone, which may include transiting through the area
- Adhere to any additional service-specific criteria that govern eligibility for IDP
Savings Deposit Program
Servicemembers in a designated combat zone — deployed for at least 30 consecutive days — and receiving HFP are eligible to participate in the Savings Deposit Program (SDP).
The SDP is designed to provide servicemembers with a secure savings vehicle while acknowledging the hardships of serving in combat zones. It encourages saving by offering a high return on deposited funds. This can be a significant benefit for service members looking to save money while deployed.
SDP allows you to deposit up to a total of $10,000 into a special account at DFAS. You’ll earn a guaranteed 10% annual interest rate. Plus, you’ll continue to accrue interest up to 90 days after departure from the combat zone. The SDP interest is tax-free.
Family Separation Allowance
Also known as family separation pay, Family Separation Allowance (FSA) is meant to help families whose servicemember is gone for more than 30 days. It’s intended to cover expenses such as additional child care, transportation, and other costs that arise as a result of your absence.
Once you’ve been separated for 31 days, FSA will be paid retroactively back to the first day of separation at the rate of $250 per month. However, it is considered taxable income. You must substantiate it by completing and submitting form DD 1561 to receive FSA.
Rest and Recuperation Leave (R&R)
Servicemembers deployed to a combat zone for 365 days with a minimum of 270 days boots on the ground are eligible for 15 days R&R leave.
Do Servicemembers Get a Per Diem While Deployed?
Although meals and housing are typically provided on a deployment, you’re still entitled to deployment per diem. This is normally paid after you return and complete a final travel voucher (DD Form 1351-2).
The amount of the per diem is determined by the Department of Defense and is broken down into three categories: meals, lodging, and incidental expenses. The incidental per diem rate is $5 for each day’s allowance.
What Tax Exemptions Are Active Servicemembers Eligible For?
Earnings received in a combat zone hold a particular tax advantage for military personnel called Combat Zone Tax Exclusion (CZTE). Your combat zone earnings are entirely excluded from taxable income — a potentially significant financial benefit.
For enlisted members and warrant officers, the exclusion is unlimited. For officers, the amount is limited to the maximum enlisted pay amount plus the amount of HFP/IDP for the qualifying month. Even if you spend just one qualifying day in a combat zone during a month, the entirety of your combat pay for that month is deemed tax-exempt.
This provision translates into substantial savings, especially for those facing a 15% tax rate. This could equate to thousands of dollars saved on a monthly basis for you and your family.
However, it's important to note that while combat zone earnings are shielded from income tax, Social Security and Medicare (FICA) taxes continue to apply to the full extent of your pay. This ensures that important contributions to these programs are sustained.
When Does Deployment Pay Start?
Hardship Duty Pay, Hostile Fire or Imminent Danger Pay, Family Separation Pay, and the tax exemption should be posted on your Leave and Earning Statement (LES) the month after you deploy. Download your LES from the Defense Finance and Accounting Service (DFAS) to verify your entitlements.
If you need help, contact your finance office as soon as possible to make the appropriate adjustments.
Make Sure You’re Covered During Deployment with AAFMAA
You give so much to your country, and at AAFMAA, we know you want to make sure your family is protected — no matter what. That’s why we offer peace of mind through our life insurance policies made for the military community.
Contact us to learn more about becoming an AAFMAA Member today.
Download the Deployment Entitlements Brochure to print or share more information about this military benefit with your loved ones.
This article was originally published August 25, 2020.