Most Recent Legislation Affects Military, Civilian Paychecks


Story Number: NNS130111-08Release Date: 1/11/2013 1:20:00 PM
A  A  A   Email this story to a friend   Print this story
From American Forces Press Service

WASHINGTON (NNS) -- The legislation that President Barack Obama signed Jan. 2 that postponed the fiscal cliff means changes to military and civilian paychecks, Defense Finance and Accounting Service officials said.

The legislation increases Social Security withholding taxes to 6.2 percent. For the past two years during the "tax holiday" the rate was 4.2 percent.

The increase in Social Security withholding taxes affects both military and civilian paychecks, officials said.

For civilian employees, officials said, this will mean a 2 percent reduction in net pay.

For military personnel, changes to net pay are affected by a variety of additional factors such as increases in basic allowances for housing, subsistence, longevity basic pay raises and promotions. Service members could see an increase in net pay, no change or a decrease, military personnel and readiness officials said.

For military members, Social Security withholding is located on their leave and earnings statement in the blocks marked "FICA taxes" - for Federal Insurance Contributions Act.

DoD civilians will see the change on their leave and earnings statement under "OASDI" - for old age, survivors, and disability insurance.

Reserve component members will be the first to see potential changes in their net pay as a result of the law, DFAS officials said. Changes will be reflected in their January paychecks.

Active duty military personnel will see pay adjustments in their January mid-month paycheck and will be reflected on the January leave and earnings statement.

DoD civilians will see social security withholding changes reflected in paychecks based on the pay period ending Dec. 29, 2012, for pay dates beginning in January.

DFAS stresses that all personnel should review pay statements carefully.

STORY COMMENTS
comments powered by Disqus
Commenting Policy
 
RELATED PHOTOS
Seaman Kenneth Wood, from Toledo, Ohio, prepares to put money on a Navy Cash card aboard the guided-missile cruiser USS Hue City (CG 66).
120828-N-NU634-064 ARABIAN SEA (Aug. 28, 2012) Seaman Kenneth Wood, from Toledo, Ohio, prepares to put money on a Navy Cash card aboard the guided-missile cruiser USS Hue City (CG 66). Hue City is deployed to the U.S. 5th Fleet area of responsibility conducting maritime security operations, theater security cooperation efforts and support missions as part of Operation Enduring Freedom. (U.S. Navy photo by Mass Communication Specialist Seaman Darien G. Kenney/Released)
August 31, 2012
Navy Social Media
Sign up for email updates To sign up for updates or to access your subscriber preferences, please click on the envelope icon in the page header above or click here.