Prior to Dec. 31, 2011, members eligible for IDP were paid the full monthly rate of $225 for any complete or partial month they served in a qualifying area. The 2012 National Defense Authorization Act modified IDP payments, limiting eligibility to only the actual days served in a qualifying area. Now service members will receive $7.50 for each day they are on official duty in an IDP area up to the maximum monthly rate of $225. The monthly rate is paid to members who serve an entire calendar month in an IDP area regardless of the number of individual days in that month.
Members who are exposed to a hostile fire or hostile mine explosion event are eligible to receive non-prorated Hostile Fire Pay (HFP) in the full monthly amount of $225. Members cannot receive both IDP and HFP in the same month.
The law required proration to begin on Dec. 31, 2011; however, implementing guidance and military pay processes were not in place to begin prorating the pay on that date. DoD began paying the prorated payments Feb. 1, 2012. Some members may have been overpaid between the date the NDAA was signed on Dec. 31, 2011, and Feb. 1, 2012, when the pay systems began proration. The military services are working to waive or remit debts for members who may have been overpaid during this period. The intent is that you will not be liable for any overpayment during this period.
Being assigned to or working in a combat zone triggers also triggers a tax advantage, in some locations. Congress and/or the President can designated combat zones as "Tax Exempt" areas. Earnings received while in these combats zone are excluded from taxable income. (NOTE: This only applies to Federal Income Tax Withholding (FITW). A military member still pays social security taxes and Medicare Tax. Whether or not State Tax is excluded is up to the individual state.
This exclusion is unlimited for enlisted members and is limited to the maximum enlisted pay amount, for officers and warrant officers.
Bonuses and special pays are also excluded from taxble income if within the previously stated limitations and earned in the same month in which you served in a combat zone. For example, an enlisted reenlistment bonus is excluded from taxes if the member reenlists in the same month in which the member served in a combat zone. Since there is no limitation on amounts excluded for enlisted members, the entire reenlistment bonus would be excluded. As another example, an officer's flight pay would also be excluded from taxable income, but only up to the point which basic pay and the flight pay do not exceed the maximum enlisted pay amount.
In addition to Immiment Danger Pay (Combat Pay), and the tax exclusion, some areas qualify for a special monthly allowance called "Hardship Duty Pay."
Military members with dependents also receive " Family Separation Allowance" (FSA) of $250.00 per month, anytime they are away from their families (due to military orders) for 30 days or longer.
Finally, members in a combat zone are authorized to to deposit up to $10,000 (per year) of their pay and allowances into a special savings account, that pays a guaranteed 10 percent interest per year. This program was established during the Vietnam era, and then phased out at the end of the Vietnam War. However, it was revived in 1991 during the Gulf War, and the program still exists today. In addition to the combat zones listed below, personnel stationed in Kazakhstan and Turkmenistan are eligible to use the program if they are supporting combat operations in Afghanistan.
Designated combat zones are listed in Department of Defense (DoD) Financial Management Regulation (FMR) Volume 7A, Chapter 44, Paragraph 440103 (DoD FMR Vol. 7A, Ch 44). Current designated combat zones include:
- Saudi Arabia
- Serbia (includes Kosovo)
- Turkey (in some cases)
- United Arab Emirates
- Persian Gulf
- Red Sea
- Gulf of Oman
- Arabian Sea (north of 10 degrees North, and west of 68 degrees East)
- Gulf of Aden
Military service outside a combat zone is considered to be performed in a combat
zone if the service is designated by DoD as being in direct support of military
operations in the combat zone, and
the service qualifies you for special military pay for duty subject to hostile fire or imminent danger.