10 U.S.C. § 12739 — Computation of retired pay

Page 3712 TITLE 10—ARMED FORCES § 12738 div. A, title XVI, § 1662(j)(1), Oct. 5, 1994, 108 Stat. 2998, 3003.) HISTORICAL AND REVISION NOTES Revised section Source (U.S. Code) Source (Statutes at Large) 1337 ......... 10:1036h. 34:440p. June 29, 1948, ch. 708, § 309, 62 Stat. 1090. 10:1036h (1st sentence) and 34:440p (1st sentence) are omitted as surplusage. The words ‘‘member of the armed forces’’ are substituted for the word ‘‘person’’, since only a member may be ‘‘ordered to active duty’’. Editorial Notes AMENDMENTS 1994—Pub. L. 103–337 renumbered section 1337 of this title as this section and amended text generally, sub- stituting ‘‘the member’’ for ‘‘him’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1994 AMENDMENT Amendment by Pub. L. 103–337 effective Dec. 1, 1994, except as otherwise provided, see section 1691 of Pub. L. 103–337, set out as an Effective Date note under section 10001 of this title. § 12738. Limitations on revocation of retired pay (a) After a person is granted retired pay under this chapter, or is notified in accordance with section 12731(d) of this title that the person has completed the years of service required for eligi- bility for retired pay under this chapter, the person’s eligibility for retired pay may not be denied or revoked on the basis of any error, mis- calculation, misinformation, or administrative determination of years of service performed as required by section 12731(a)(2) of this title, un- less it resulted directly from the fraud or mis- representation of the person. (b) The number of years of creditable service upon which retired pay is computed may be ad- justed to correct any error, miscalculation, mis- information, or administrative determination and when such a correction is made the person is entitled to retired pay in accordance with the number of years of creditable service, as cor- rected, from the date the person is granted re- tired pay. (Added Pub. L. 89–652, § 2(1), Oct. 14, 1966, 80 Stat. 902, § 1406; renumbered § 1338 and amended Pub. L. 99–348, title I, § 104(a), July 1, 1986, 100 Stat. 686; renumbered § 12738 and amended Pub. L. 103–337, div. A, title XVI, § 1662(j)(1), Oct. 5, 1994, 108 Stat. 2998, 3003.) Editorial Notes AMENDMENTS 1994—Pub. L. 103–337 renumbered section 1338 of this title as this section and amended text generally, mak- ing changes in style and references to other sections. 1986—Pub. L. 99–348 renumbered section 1406 of this title as this section, designated first sentence as sub- sec. (a) and substituted ‘‘this chapter’’ for ‘‘chapter 67 of this title’’ in two places, and designated second sen- tence as subsec. (b). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1994 AMENDMENT Amendment by Pub. L. 103–337 effective Dec. 1, 1994, except as otherwise provided, see section 1691 of Pub. L. 103–337, set out as an Effective Date note under section 10001 of this title. ENTITLEMENT TO RETIREMENT PAY AFTER OCTOBER 14, 1966; CONCLUSIVENESS Pub. L. 89–652, § 3, Oct. 14, 1966, 80 Stat. 902, provided that: ‘‘Notwithstanding section 1406 [now 12738] of title 10, United States Code, as added by this Act— ‘‘(1) the granting of retired pay to a person under chapter 67 [now 1223] of that title is conclusive as to that person’s entitlement to such pay only if the pay- ment of that retired pay is begun after the effective date of this Act [Oct. 14, 1966]; and ‘‘(2) a notification that a person has completed the years of service required for eligibility for retired pay under chapter 67 [now 1223] of that title is conclusive as to the person’s subsequent entitlement to such pay only if the notification is made after the effective date of this Act.’’ § 12739. Computation of retired pay (a) The monthly retired pay of a person enti- tled to that pay under this chapter is the prod- uct of— (1) the retired pay base for that person as computed under section 1406(b)(2) or 1407 of this title; and (2) 21⁄2 percent of the years of service cred- ited to that person under section 12733 of this title. (b) If a person entitled to retired pay under this chapter has been credited by the Secretary concerned with extraordinary heroism in the line of duty and if the highest grade held satis- factorily by that person at any time in the armed forces is an enlisted grade, the person’s retired pay shall be increased by 10 percent of the amount determined under subsection (a). The Secretary’s determination as to extraor- dinary heroism is conclusive for all purposes. (c)(1) Except as provided in paragraph (2), the total amount of the monthly retired pay com- puted under subsections (a) and (b) may not ex- ceed 75 percent of the retired pay base upon which the computation is based. (2) In the case of a person who retires after De- cember 31, 2006, with more than 30 years of serv- ice credited to that person under section 12733 of this title, the total amount of the monthly re- tired pay computed under subsections (a) and (b) may not exceed the sum of— (A) 75 percent of the retired pay base upon which the computation is based; and (B) the product of— (i) the retired pay base upon which the computation is based; and (ii) 21⁄2 percent of the years of service cred- ited to that person under section 12733 of this title, for service under conditions au- thorized for purposes of this paragraph dur- ing a period designated by the Secretary of Defense for purposes of this paragraph. (d) Amounts computed under this section, if not a multiple of $1, shall be rounded down to the next lower multiple of $1. (e)(1) If a member of the Retired Reserve is re- called to an active status in the Selected Re- serve of the Ready Reserve under section 10145(d) of this title and completes not less than two years of service in such active status, the member is entitled to the recomputation under this section of the retired pay of the member. Page 3713 TITLE 10—ARMED FORCES § 12739 (2) The Secretary concerned may reduce the two-year service requirement specified in para- graph (1) in the case of a member who— (A) is recalled to serve in a position of adju- tant general required under section 314 of title 32 or in a position of assistant adjutant gen- eral subordinate to such a position of adjutant general; (B) completes at least one year of service in such position; and (C) fails to complete the minimum two years of service solely because the appointment of the member to such position is terminated or vacated as described in section 324(b) of title 32. (f) MODERNIZED RETIREMENT SYSTEM.— (1) REDUCED MULTIPLIER FOR FULL TSP MEM- BERS.—Notwithstanding subsection (a) or (c), in the case of a person who first performs re- serve component service on or after January 1, 2018, after not having performed regular or re- serve component service on or before that date, or a person who makes the election de- scribed in paragraph (2) (referred to as a ‘‘full TSP member’’)— (A) subsection (a)(2) shall be applied by substituting ‘‘2 percent’’ for ‘‘21⁄2 percent’’; (B) subparagraph (A) of subsection (c)(2) shall be applied by substituting ‘‘60 percent’’ for ‘‘75 percent’’; and (C) subparagraph (B)(ii) of such subsection shall be applied by substituting ‘‘2 percent’’ for ‘‘21⁄2 percent’’. (2) ELECTION TO PARTICIPATE IN MODERNIZED RETIREMENT SYSTEM.— (A) IN GENERAL.—Pursuant to subpara- graph (B), a person performing reserve com- ponent service on December 31, 2017, who has performed fewer than 12 years of service as of December 31, 2017 (as computed in accord- ance with section 12733 of this title), may elect, in exchange for the reduced multi- pliers described in paragraph (1) for purposes of calculating the retired pay of the person, to receive Thrift Savings Plan contributions pursuant to section 8440e(e) of title 5. (B) ELECTION PERIOD.— (i) IN GENERAL.—Except as provided in clauses (ii) and (iii), a person described in subparagraph (A) may make the election described in that subparagraph during the period that begins on January 1, 2018, and ends on December 31, 2018. (ii) HARDSHIP EXTENSION.—The Secretary concerned may extend the election period described in clause (i) for a person who ex- periences a hardship as determined by the Secretary concerned. (iii) PERSONS EXPERIENCING BREAK IN SERVICE.—A person returning to reserve component service after a break in reserve component service in which falls the elec- tion period specified in clause (i) shall make the election described in subpara- graph (A) within 30 days after the date of the reentry into service of the person. (C) NO RETROACTIVE CONTRIBUTIONS PURSU- ANT TO ELECTION.—Thrift Savings Plan con- tributions may not be made for a person making an election pursuant to subpara- graph (A) for any pay period beginning be- fore the date of the person’s election under that subparagraph by reason of the person’s election. (3) REGULATIONS.—The Secretary concerned shall prescribe regulations to implement this subsection. (Added Pub. L. 103–337, div. A, title XVI, § 1662(j)(1), Oct. 5, 1994, 108 Stat. 3004; amended Pub. L. 107–314, div. A, title VI, § 632(a), (b), Dec. 2, 2002, 116 Stat. 2572; Pub. L. 109–364, div. A, title VI, § 642(b), Oct. 17, 2006, 120 Stat. 2259; Pub. L. 111–84, div. A, title VI, § 642(a), Oct. 28, 2009, 123 Stat. 2365; Pub. L. 114–92, div. A, title VI, § 631(b), Nov. 25, 2015, 129 Stat. 843; Pub. L. 115–91, div. A, title VI, § 623(a), Dec. 12, 2017, 131 Stat. 1428.) Editorial Notes PRIOR PROVISIONS Provisions similar to those in this section were con- tained in formula 3 of the table in section 1401(a) of this title, prior to amendment by Pub. L. 103–337, § 1662(j)(2). AMENDMENTS 2017—Subsec. (f)(2)(B)(iii). Pub. L. 115–91 substituted ‘‘within 30 days after the date of the reentry’’ for ‘‘on the date of the reentry’’. 2015—Subsec. (f). Pub. L. 114–92 added subsec. (f). 2009—Subsec. (e). Pub. L. 111–84 added subsec. (e). 2006—Subsec. (c). Pub. L. 109–364 designated existing provisions as par. (1), substituted ‘‘Except as provided in paragraph (2), the’’ for ‘‘The’’, and added par. (2). 2002—Subsec. (b). Pub. L. 107–314, § 632(a)(2), added subsec. (b). Former subsec. (b) redesignated (c). Subsec. (c). Pub. L. 107–314, § 632(a)(1), (b), redesig- nated subsec. (b) as (c) and substituted ‘‘total amount of the monthly retired pay computed under subsections (a) and (b)’’ for ‘‘amount computed under subsection (a)’’. Former subsec. (c) redesignated (d). Subsec. (d). Pub. L. 107–314, § 632(a)(1), redesignated subsec. (c) as (d). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2017 AMENDMENT Pub. L. 115–91, div. A, title VI, § 623(b), Dec. 12, 2017, 131 Stat. 1429, provided that: ‘‘The amendment made by subsection (a) [amending this section] shall take effect on January 1, 2018, immediately after the coming into effect of the amendment made by section 631(b) of the National Defense Authorization Act for Fiscal Year 2016 (Public Law 114–92; 129 Stat. 843) [amending this section], to which the amendment made by subsection (a) relates.’’ EFFECTIVE DATE OF 2015 AMENDMENT; IMPLEMENTATION Amendment by Pub. L. 114–92 effective Jan. 1, 2018, with certain implementation requirements, see section 635 of Pub. L. 114–92, set out as a note under section 8432 of Title 5, Government Organization and Employees. EFFECTIVE DATE OF 2002 AMENDMENT Pub. L. 107–314, div. A, title VI, § 632(c), Dec. 2, 2002, 116 Stat. 2572, provided that: ‘‘The amendments made by subsections (a) and (b) [amending this section] shall take effect on October 1, 2002, and shall apply with re- spect to retired pay for months beginning on or after that date.’’ EFFECTIVE DATE Section effective Dec. 1, 1994, except as otherwise pro- vided, see section 1691 of Pub. L. 103–337, set out as a note under section 10001 of this title. Page 3714 TITLE 10—ARMED FORCES § 12740 § 12740. Eligibility: denial upon certain punitive discharges or dismissals A person who— (1) is convicted of an offense under the Uni- form Code of Military Justice (chapter 47 of this title) and whose sentence includes death; or (2) is separated pursuant to sentence of a court-martial with a dishonorable discharge, a bad conduct discharge, or (in the case of an of- ficer) a dismissal, is not eligible for retired pay under this chapter. (Added Pub. L. 104–106, div. A, title VI, § 632(a)(1), Feb. 10, 1996, 110 Stat. 365.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Pub. L. 104–106, div. A, title VI, § 632(b), Feb. 10, 1996, 110 Stat. 365, provided that: ‘‘Section 12740 of title 10, United States Code, as added by subsection (a), shall apply with respect to court-martial sentences adjudged after the date of the enactment of this Act [Feb. 10, 1996].’’ § 12741. Retirement for service in an active sta- tus performed in the Selected Reserve of the Ready Reserve after eligibility for regular re- tirement (a) AUTHORITY TO ELECT TO RECEIVE RESERVE RETIRED PAY.—(1) Notwithstanding the require- ment in paragraph (4) of section 12731(a) of this title that a person may not receive retired pay under this chapter when the person is entitled, under any other provision of law, to retired pay or retainer pay, a person may elect to receive retired pay under this chapter, instead of receiv- ing retired or retainer pay under chapter 65, 741, 841, or 941 of this title, if the person— (A) satisfies the requirements specified in paragraphs (1) and (2) of such section for enti- tlement to retired pay under this chapter; (B) served in an active status in the Selected Reserve of the Ready Reserve after becoming eligible for retirement under chapter 65, 741, 841, or 941 of this title (without regard to whether the person actually retired or re- ceived retired or retainer pay under one of those chapters); and (C) completed not less than two years of sat- isfactory service (as determined by the Sec- retary concerned) in such active status (ex- cluding any period of active service). (2) The Secretary concerned may reduce the minimum two-year service requirement speci- fied in paragraph (1)(C) in the case of a person who— (A) completed at least one year of service in a position of adjutant general required under section 314 of title 32 or in a position of assist- ant adjutant general subordinate to such a po- sition of adjutant general; and (B) failed to complete the minimum years of service solely because the appointment of the person to such position was terminated or va- cated as described in section 324(b) of title 32. (b) ACTIONS TO EFFECTUATE ELECTION.—As of the effective date of an election made by a per- son under subsection (a), the Secretary con- cerned shall— (1) terminate the eligibility of the person to retire under chapter 65, 741, 841, or 941 of this title, if the person is not already retired under one of those chapters, and terminate entitle- ment of the person to retired or retainer pay under one of those chapters, if the person was already receiving retired or retainer pay under one of those chapters; and (2) in the case of a reserve commissioned of- ficer, transfer the officer to the Retired Re- serve. (c) TIME AND FORM OF ELECTION.—An election under subsection (a) shall be made within such time and in such form as the Secretary con- cerned requires. (d) EFFECTIVE DATE OF ELECTION.—An election made by a person under subsection (a) shall be effective— (1) except as provided in paragraph (2)(B), as of the date on which the person attains the eli- gibility age applicable to the person under sec- tion 12731(f) of this title, if the Secretary con- cerned receives the election in accordance with this section within 180 days after that date; or (2) on the first day of the first month that begins after the date on which the Secretary concerned receives the election in accordance with this section, if— (A) the date of the receipt of the election is more than 180 days after the date on which the person attains the eligibility age applicable to the person under such section; or (B) the person retires from service in an active status within that 180-day period. (Added Pub. L. 106–398, § 1 [[div. A], title VI, § 653(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–164; amended Pub. L. 107–107, div. A, title X, § 1048(a)(31), Dec. 28, 2001, 115 Stat. 1225; Pub. L. 109–364, div. A, title X, § 1071(a)(41), Oct. 17, 2006, 120 Stat. 2400; Pub. L. 111–84, div. A, title VI, § 643(a)–(c), (e)(1), Oct. 28, 2009, 123 Stat. 2366, 2367; Pub. L. 115–232, div. A, title VIII, § 809(a), Aug. 13, 2018, 132 Stat. 1840.) Editorial Notes AMENDMENTS 2018—Subsec. (a)(1). Pub. L. 115–232 substituted ‘‘chap- ter 65, 741, 841, or 941’’ for ‘‘chapter 65, 367, 571, or 867’’ in introductory provisions and in subpar. (B). Subsec. (b)(1). Pub. L. 115–232 substituted ‘‘chapter 65, 741, 841, or 941’’ for ‘‘chapter 65, 367, 571, or 867’’. 2009—Pub. L. 111–84, § 643(e)(1), substituted ‘‘Retire- ment for service in an active status performed in the Selected Reserve of the Ready Reserve after eligibility for regular retirement’’ for ‘‘Retirement from active reserve service performed after regular retirement’’ in section catchline. Subsec. (a). Pub. L. 111–84, § 643(a), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: ‘‘(a) ELECTION OF RESERVE RETIRED PAY.—A person who, after becoming entitled to retired or retainer pay under chapter 65, 367, 571, or 867 of this title, serves in an active status in a reserve component is entitled to retired pay under this chapter if— ‘‘(1) the person would, but for paragraphs (3) and (4) of section 12731(a) of this title, otherwise be entitled to retired pay under this chapter; ‘‘(2) the person elects under this section to receive retired pay under this chapter; and