Posted on May 18, 2015
Combat zone reenlistment/tax exempt bonus question
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This is related to my earlier thread on my reenlistment bonus, but I don't think anybody has noticed my follow-up question buried in it.
You folks who have received tax exempt reenlistment bonuses, for reenlisting in a combat zone - were the payments you received a tax-free lump sum, or did they cut out tax, then refund it later, like they did with our deployed paychecks (as I understand the way we got paid)?
For example, if you had a $10,000 lump sum bonus, did you get a check for $7,500 with $2,500 deducted for income tax, and then a second check paying you back the $2,500, or did you get 1 check for $10,000?
Now that I finally got paid (well, LES pending...) my bonus from my 2013 reenlistment, I am trying to figure out whether I need to send in a pay inquiry on the deduction of income taxes from it.
You folks who have received tax exempt reenlistment bonuses, for reenlisting in a combat zone - were the payments you received a tax-free lump sum, or did they cut out tax, then refund it later, like they did with our deployed paychecks (as I understand the way we got paid)?
For example, if you had a $10,000 lump sum bonus, did you get a check for $7,500 with $2,500 deducted for income tax, and then a second check paying you back the $2,500, or did you get 1 check for $10,000?
Now that I finally got paid (well, LES pending...) my bonus from my 2013 reenlistment, I am trying to figure out whether I need to send in a pay inquiry on the deduction of income taxes from it.
Posted in these groups: 
CZTE (Combat Zone Tax Exclusion)
CZTE (Combat Zone Tax Exclusion)
Edited >1 y ago
Posted >1 y ago
Responses: 5
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I just got an email from the guy who handled my reenlsitment contract in Afghanistan. He said it is normal for them to cut the tax, then refund it in another check, like they did with our pay, so I should give that about 30 days before sending a pay inquiry.
SFC Combs
SFC Combs
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SSG (Join to see)
Did u receive your reimbursement after waiting 30 days? I'm currently in the same situation. Still within that 30 period.
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SSG (Join to see)
Verified. My bonus check was taxed. Later received a tax free refund check for the amount of taxes that they took out within 2 weeks.
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SFC (Join to see)
I know it should be tax free, but my question whether an LES showing taxes cut means there is a mistake, or it's part of the method. For example: your paycheck, while deployed, was tax free, but your LES shows they cut taxes out, then refunded the taxes with the next check.
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1SG (Join to see)
I would talk to finance first maybe there is a reason they taxed you that I am not aware of and if not talk to who ever does our taxes they may be able to assist.
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SFC (Join to see)
Noirmally, in the Army, the "reason" is called a mistake, but I'm just trying to make sure before I send up a pay inquiry.
The CZTE thing I'm talking about is: "CZTE Refunds/Split-payments: At first glance at your LESs, it may appear that you have not received the total tax refunds for CZTE or have been underpaid, but you’re not. Your monthly tax exclusions for CZTE are not given to you in full during the same month they are earned; instead, they are refunded to you at the beginning (1st pay cycle) of the following month. Your federal tax refunds will reflect on your LES as “WITHHELD TAX REF” and state tax refunds as “OTHER CREDITS.”" So that's what makes me hesitant to assume it's a mistake at first glance.
The CZTE thing I'm talking about is: "CZTE Refunds/Split-payments: At first glance at your LESs, it may appear that you have not received the total tax refunds for CZTE or have been underpaid, but you’re not. Your monthly tax exclusions for CZTE are not given to you in full during the same month they are earned; instead, they are refunded to you at the beginning (1st pay cycle) of the following month. Your federal tax refunds will reflect on your LES as “WITHHELD TAX REF” and state tax refunds as “OTHER CREDITS.”" So that's what makes me hesitant to assume it's a mistake at first glance.
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When I did my first re-enlistment, I was eligible for a bonus of 4,500, and I received all 3,300 (after taxes) together as one lump sum.
Now that I am doing my second re-enlistment, I am eligible for a bonus of 11,100 (tier 5, 60 months, 35F Airborne Position), and just received approximately 4100. I am not sure why, as 8,250 should have been the approximate bonus after a 25% tax.
This is the first I have heard of the "you will receive half your bonus now and the other half annually". Can anyone provide me the regulation to verify that statement, as I didn't receive my bonus in the past like this, or provide me any further information regarding my situation? Thanks!
Now that I am doing my second re-enlistment, I am eligible for a bonus of 11,100 (tier 5, 60 months, 35F Airborne Position), and just received approximately 4100. I am not sure why, as 8,250 should have been the approximate bonus after a 25% tax.
This is the first I have heard of the "you will receive half your bonus now and the other half annually". Can anyone provide me the regulation to verify that statement, as I didn't receive my bonus in the past like this, or provide me any further information regarding my situation? Thanks!
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