10 U.S.C. § 1175 — Voluntary separation incentive

Page 1243 TITLE 10—ARMED FORCES § 1175 from active duty through the programs provided under section 1174a and 1175 of title 10, United States Code— ‘‘(A) elected not to accept such discharge or separa- tion; and ‘‘(B) submits an application under subsection (b) during the two-year period beginning on the later of the date of the enactment of this Act [Nov. 30, 1993] and the date of such discharge or separation. ‘‘(b) APPLICATION.—A review under this section shall be conducted in any case submitted to the Secretary concerned by application from the officer or former of- ficer under regulations prescribed by the Secretary. ‘‘(c) PURPOSE OF REVIEW.—(1) The review under this section shall be designed to evaluate the effectiveness of the counseling of the officer before the convening of the board to ensure that the officer was properly in- formed that selection for discharge or other separation from active duty was a potential result of being within the group of officers to be considered by the board and that the officer was not improperly informed that such selection in that officer’s personal case was unlikely. ‘‘(2) The Board for the Correction of Military Records of a military department shall render a decision in each case under this section not later than 60 days after receipt by the Secretary concerned of an application under subsection (b). ‘‘(d) REMEDY.—Upon a finding of ineffective coun- seling under subsection (c), the Secretary shall provide the officer the opportunity to participate, at the offi- cer’s option, in any one of the following programs for which the officer meets all eligibility criteria: ‘‘(1) The Special Separation Benefits program under section 1174a of title 10, United States Code. ‘‘(2) The Voluntary Separation Incentive program under section 1175 of such title. ‘‘(3) Retirement under the authority provided by section 4403 of the National Defense Authorization Act for Fiscal Year 1993 (Public Law 102–484; 106 Stat. 2702; 10 U.S.C. 1293 note). ‘‘(e) EFFECTIVE DATE.—This section shall apply with respect to officers separated after September 30, 1990.’’ SEPARATION PAYMENTS; REDUCTIONS AND PROHIBITIONS Pub. L. 103–335, title VIII, § 8106A, Sept. 30, 1994, 108 Stat. 2645, as amended by Pub. L. 104–6, title I, § 105(a), Apr. 10, 1995, 109 Stat. 79, which provided that members who separated after Sept. 30, 1994, from active duty or full-time National Guard duty in a military depart- ment pursuant to a Special Separation Benefits pro- gram under section 1174a of this title or a Voluntary Separation Incentive program under section 1175 of this title would have their separation payments reduced by the amount of certain bonus payments and eliminated if they are rehired within 180 days by the Department of Defense in a civilian position and that civilian De- partment of Defense employees would not receive vol- untary separation payments if rehired by a Federal agency within 180 days of separating from the Depart- ment of Defense, was from the Department of Defense Appropriations Act, 1995, and was not repeated in sub- sequent appropriation acts. Similar provisions were contained in the following prior appropriation act: Pub. L. 103–139, title VIII, § 8127, Nov. 11, 1993, 107 Stat. 1469. COMMENCEMENT OF PROGRAM Pub. L. 102–190, div. A, title VI, § 661(b), Dec. 5, 1991, 105 Stat. 1395, provided that: ‘‘The Secretary of each military department shall commence the program re- quired by section 1174a of title 10, United States Code (as added by subsection (a)), not later than 60 days after the date of the enactment of this Act [Dec. 5, 1991].’’ REPORT ON PROGRAMS Pub. L. 102–190, div. A, title VI, § 663, Dec. 5, 1991, 105 Stat. 1399, directed Secretary, not later than 180 days after Dec. 5, 1991, to submit to Congress a report con- taining the Secretary’s assessment of effectiveness of programs established under sections 1174a and 1175 of this title. § 1175. Voluntary separation incentive (a)(1) Consistent with this section and the availability of appropriations for this purpose, the Secretary of Defense and the Secretary of Homeland Security may provide a financial in- centive to members of the armed forces de- scribed in subsection (b) for voluntary appoint- ment, enlistment, or transfer to a reserve com- ponent, requested and approved under sub- section (c). (2)(A) Except as provided in subparagraph (B), a financial incentive provided a member under this section shall be paid for the period equal to twice the number of years of service of the mem- ber, computed as provided in subsection (e)(5). (B) If, before the expiration of the period oth- erwise applicable under subparagraph (A) to a member receiving a financial incentive under this section, the member is separated from a re- serve component or is transferred to the Retired Reserve, the period for payment of a financial incentive to the member under this section shall terminate on the date of the separation or trans- fer unless— (i) the separation or transfer is required by reason of the age or number of years of service of the member; (ii) the separation or transfer is required by reason of the failure of selection for promotion or the medical disqualification of the member, except in a case in which the Secretary of De- fense or the Secretary of Homeland Security determines that the basis for the separation or transfer is a result of a deliberate action taken by the member with the intent to avoid retention in the Ready Reserve or Standby Re- serve; or (iii) in the case of a separation, the member is separated from the reserve component for appointment or enlistment in or transfer to another reserve component of an armed force for service in the Ready Reserve or Standby Reserve of that armed force. (b) The Secretary of Defense and the Secretary of Homeland Security may provide the incentive to a member of the armed forces if the mem- ber— (1) has served on active duty or full-time Na- tional Guard duty or any combination of ac- tive duty and full-time National Guard duty for more than 6 but less than 20 years; (2) has served at least 5 years of continuous active duty or full-time National Guard duty or any combination of active duty and full- time National Guard duty immediately pre- ceding the date of separation; (3) meets such other requirements as the Secretary may prescribe from time to time, which may include requirements relating to— (A) years of service; (B) skill or rating; (C) grade or rank; and (D) remaining period of obligated service. (c) A member of the armed forces offered a voluntary separation incentive under this sec- tion shall be offered the opportunity to request separation under a program established pursu- Page 1244 TITLE 10—ARMED FORCES § 1175 ant to section 1174a of this title. If the Secretary concerned approves a request for separation under either such section, the member shall be separated under the authority of the section se- lected by such member. (d)(1) A member of the armed forces described in subsection (b) may request voluntary ap- pointment, enlistment, or transfer to a reserve component accompanied by this incentive, pro- vided the member has completed 6 years of ac- tive service. (2) The Secretary, in his discretion, may ap- prove or disapprove a request according to the needs of the armed forces. (3) After December 31, 2001, the Secretary may not approve a request. (e)(1) The annual payment of the incentive shall equal 2.5 percent of the monthly basic pay the member receives on the date appointed, en- listed, or transferred to the reserve component, multiplied by twelve and multiplied again by the member’s years of service. (2) A member entitled to voluntary separation incentive payments who is also entitled to basic pay for active or reserve service, or compensa- tion for inactive duty training, may elect to have a reduction in the voluntary separation in- centive payable for the same period in an amount not to exceed the amount of the basic pay or compensation received for that period. (3)(A) A member who has received the vol- untary separation incentive and who later quali- fies for retired or retainer pay under this title shall have deducted from each payment of such retired or retainer pay an amount, in such schedule of monthly installments as the Sec- retary of Defense shall specify, taking into ac- count the financial ability of the member to pay and avoiding the imposition of undue financial hardship on the member and member’s depend- ents, until the total amount deducted is equal to the total amount of voluntary separation incen- tive so paid. If the member elected to have a re- duction in voluntary separation incentive for any period pursuant to paragraph (2), the deduc- tion required under the preceding sentence shall be reduced as the Secretary of Defense shall specify. (B) If a member is receiving simultaneous vol- untary separation incentive payments and re- tired or retainer pay, the member may elect to terminate the receipt of voluntary separation incentive payments. Any such election is perma- nent and irrevocable. The rate of monthly recoupment from retired or retainer pay of vol- untary separation incentive payments received after such an election shall be reduced by a per- centage that is equal to a fraction with a de- nominator equal to the number of months that the voluntary separation incentive payments were scheduled to be paid and a numerator equal to the number of months that would not be paid as a result of the member’s decision to termi- nate the voluntary separation incentive. (4) A member who is receiving voluntary sepa- ration incentive payments shall not be deprived of this incentive by reason of entitlement to dis- ability compensation under the laws adminis- tered by the Department of Veterans Affairs, but there shall be deducted from voluntary sepa- ration incentive payments an amount equal to the amount of any such disability compensation concurrently received. Notwithstanding the pre- ceding sentence, no deduction may be made from voluntary separation incentive payments for any disability compensation received be- cause of an earlier period of active duty if the voluntary separation incentive is received be- cause of discharge or release from a later period of active duty. (5) The years of service of a member for pur- poses of this section shall be computed in ac- cordance with section 1405 of this title. (f) The member’s right to incentive payments shall not be transferable, except that the mem- ber may designate beneficiaries to receive the payments in the event of the member’s death. (g) Subject to subsection (h), payments under this provision shall be paid from appropriations available to the Department of Defense and the Department of Homeland Security for the Coast Guard. (h)(1) There is established on the books of the Treasury a fund to be known as the ‘‘Voluntary Separation Incentive Fund’’ (hereinafter in this subsection referred to as the ‘‘Fund’’). The Fund shall be administered by the Secretary of the Treasury. The Fund shall be used for the accu- mulation of funds in order to finance on an actu- arially sound basis the liabilities of the Depart- ment of Defense under this section. (2) There shall be deposited in the Fund the following, which shall constitute the assets of the Fund: (A) Amounts paid into the Fund under para- graphs (5), (6), and (7). (B) Any amount appropriated to the Fund. (C) Any return on investment of the assets of the Fund. (3) All voluntary separation incentive pay- ments made by the Secretary of Defense after December 31, 1992, under this section shall be paid out of the Fund. To the extent provided in appropriation Acts, the assets of the Fund shall be available to the Secretary to pay voluntary separation incentives under this section. (4) The Department of Defense Board of Actu- aries (hereinafter in this subsection referred to as the ‘‘Board’’) shall perform the same func- tions regarding the Fund, as provided in this subsection, as such Board performs regarding the Department of Defense Military Retirement Fund. (5) Not later than January 1, 1993, the Board shall determine the amount that is the present value, as of that date, of the future benefits pay- able under this section in the case of persons who are separated pursuant to this section be- fore that date. The amount so determined is the original unfunded liability of the Fund. The Board shall determine an appropriate amortiza- tion period and schedule for liquidation of the original unfunded liability. The Secretary shall make deposits to the Fund in accordance with that amortization schedule. (6) For persons separated under this section on or after January 1, 1993, the Secretary shall de- posit in the Fund during the period beginning on that date and ending on September 30, 1999— (A) such sums as are necessary to pay the current liabilities under this section during such period; and Page 1245 TITLE 10—ARMED FORCES § 1175 1 See References in Text note below. (B) the amount equal to the present value, as of September 30, 1999, of the future benefits payable under this section, as determined by the Board. (7)(A) For each fiscal year after fiscal year 1999, the Board shall— (i) carry out an actuarial valuation of the Fund and determine any unfunded liability of the Fund which deposits under paragraphs (5) and (6) do not liquidate, taking into consider- ation any cumulative actuarial gain or loss to the Fund; (ii) determine the period over which that un- funded liability should be liquidated; and (iii) determine for the following fiscal year, the total amount, and the monthly amount, of the Department of Defense contributions that must be made to the Fund during that fiscal year in order to fund the unfunded liabilities of the Fund over the applicable amortization periods. (B) The Board shall carry out its responsibil- ities for each fiscal year in sufficient time for the amounts referred to in subparagraph (A)(iii) to be included in budget requests for that fiscal year. (C) The Secretary of Defense shall pay into the Fund at the end of each month as the Depart- ment of Defense contribution to the Fund the amount necessary to liquidate unfunded liabil- ities of the Fund in accordance with the amorti- zation schedules determined by the Board. (8) Amounts paid into the Fund under this sub- section shall be paid from funds available for the pay of members of the armed forces under the jurisdiction of the Secretary of each military department. (9) The investment provisions of section 1467 of this title shall apply to the Voluntary Separa- tion Incentive Fund. (i) The Secretary of Defense and the Secretary of Homeland Security may issue such regula- tions as may be necessary to carry out this sec- tion. (j) A member of the armed forces who is pro- vided a voluntary separation incentive under this section shall be eligible for the same bene- fits and services as are provided under chapter 58 of this title, sections 452 and 453(c) of title 37, and section 503(c) of the National Defense Au- thorization Act for Fiscal Year 1991 (104 Stat. 1558; 37 U.S.C. 476 1 note) for members of the armed forces who are involuntarily separated within the meaning of section 1141 of this title. (Added Pub. L. 102–190, div. A, title VI, § 662(a)(1), Dec. 5, 1991, 105 Stat. 1396; amended Pub. L. 102–484, div. A, title X, § 1052(16), div. D, title XLIV, §§ 4405(b), 4406(a), (b), 4422(b), Oct. 23, 1992, 106 Stat. 2499, 2706, 2707, 2719; Pub. L. 103–160, div. A, title V, §§ 502, 561(h), Nov. 30, 1993, 107 Stat. 1644, 1668; Pub. L. 103–337, div. A, title V, § 542(c), Oct. 5, 1994, 108 Stat. 2769; Pub. L. 105–261, div. A, title V, §§ 561(b), 563(a), (b), Oct. 17, 1998, 112 Stat. 2025, 2028; Pub. L. 106–398, § 1 [[div. A], title V, §§ 571(b), 572(a)], Oct. 30, 2000, 114 Stat. 1654, 1654A–134, 1654A–135; Pub. L. 107–296, title XVII, § 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 110–181, div. A, title IX, § 906(c)(1), Jan. 28, 2008, 122 Stat. 277; Pub. L. 111–32, title III, § 318(b), June 24, 2009, 123 Stat. 1874; Pub. L. 112–81, div. A, title VI, § 631(f)(4)(A), Dec. 31, 2011, 125 Stat. 1465; Pub. L. 112–239, div. A, title X, § 1076(a)(9), Jan. 2, 2013, 126 Stat. 1948; Pub. L. 117–263, div. A, title VI, § 626(c)(3), Dec. 23, 2022, 136 Stat. 2628.) Editorial Notes REFERENCES IN TEXT Section 503(c) of the National Defense Authorization Act for Fiscal Year 1991, referred to in subsec. (j), is section 503(c) of Pub. L. 101–510, div. A, title V, Nov. 5, 1990, 104 Stat. 1558, which was formerly set out as a note under section 476 of Title 37, Pay and Allowances of the Uniformed Services, prior to transfer and is now set out as a note under section 453 of Title 37. AMENDMENTS 2022—Subsec. (j). Pub. L. 117–263 substituted ‘‘sections 452 and 453(c)’’ for ‘‘sections 474 and 476’’. 2013—Subsec. (j). Pub. L. 112–239, § 1076(a)(9), made technical amendment to directory language of Pub. L. 112–81, § 631(f)(4)(A). See 2011 Amendment note below. 2011—Subsec. (j). Pub. L. 112–81, § 631(f)(4)(A), as amended by Pub. L. 112–239, § 1076(a)(9), substituted ‘‘474’’ for ‘‘404’’ and substituted ‘‘476’’ for ‘‘406’’ in two places. 2009—Subsec. (e)(3)(A). Pub. L. 111–32 amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: ‘‘A member who has received the voluntary separation incentive and who qualifies for retired or re- tainer pay under this title shall have deducted from each payment of such retired or retainer pay so much of such pay as is based on the service for which he re- ceived the voluntary separation incentive until the total amount deducted equals the total amount of vol- untary separation incentive received. If the member elected to have a reduction in voluntary separation in- centive for any period pursuant to paragraph (2), the deduction required under the preceding sentence shall be reduced accordingly.’’ 2008—Subsec. (h)(4). Pub. L. 110–181 struck out ‘‘Re- tirement’’ before ‘‘Board of Actuaries’’. 2002—Subsecs. (a)(1), (2)(B)(ii), (b), (g), (i). Pub. L. 107–296 substituted ‘‘of Homeland Security’’ for ‘‘of Transportation’’. 2000—Subsec. (d)(3). Pub. L. 106–398, § 1 [[div. A], title V, § 571(b)], substituted ‘‘December 31, 2001’’ for ‘‘Sep- tember 30, 2001’’. Subsec. (e)(3). Pub. L. 106–398, § 1 [[div. A], title V, § 572(a)], designated existing provisions as subpar. (A) and added subpar. (B). 1998—Subsec. (a). Pub. L. 105–261, § 563(a), designated existing provisions as par. (1), struck out ‘‘, for the pe- riod of time the member serves in a reserve compo- nent’’ after ‘‘under subsection (c)’’, and added par. (2). Subsec. (d)(3). Pub. L. 105–261, § 561(b), substituted ‘‘September 30, 2001’’ for ‘‘September 30, 1999’’. Subsec. (e)(1). Pub. L. 105–261, § 563(b), struck out at end ‘‘The annual payment will be made for a period equal to the number of years that is equal to twice the number of years of service of the member.’’ 1994—Subsecs. (a), (b). Pub. L. 103–337, § 542(c)(1), in- serted ‘‘and the Secretary of Transportation’’ after ‘‘Secretary of Defense’’. Subsec. (c). Pub. L. 103–337, § 542(c)(2), struck out ‘‘of the military department’’ after ‘‘Secretary’’. Subsec. (g). Pub. L. 103–337, § 542(c)(3), inserted ‘‘and the Department of Transportation for the Coast Guard’’ before period at end. Subsec. (h)(3). Pub. L. 103–337, § 542(c)(4), inserted ‘‘by the Secretary of Defense’’ after ‘‘incentive payments made’’ and ‘‘to the Secretary’’ after ‘‘shall be avail- able’’. Subsec. (i). Pub. L. 103–337, § 542(c)(5), inserted ‘‘and the Secretary of Transportation’’ after ‘‘Secretary of Defense’’. Page 1246 TITLE 10—ARMED FORCES § 1175a 1993—Subsec. (d)(1). Pub. L. 103–160, § 502, struck out ‘‘before December 5, 1991’’ after ‘‘active service’’. Subsecs. (d)(3), (h)(6). Pub. L. 103–160, § 561(h)(1), sub- stituted ‘‘September 30, 1999’’ for ‘‘September 30, 1995’’ wherever appearing. Subsec. (h)(7)(A). Pub. L. 103–160, § 561(h)(2), sub- stituted ‘‘fiscal year 1999’’ for ‘‘fiscal year 1996’’. 1992—Subsec. (a). Pub. L. 102–484, § 1052(16)(A), sub- stituted ‘‘reserve component’’ for ‘‘Reserve compo- nent’’ after ‘‘transfer to a’’. Subsec. (b)(1), (2). Pub. L. 102–484, § 4422(b)(1), (2), in- serted ‘‘or full-time National Guard duty or any com- bination of active duty and full-time National Guard duty’’ after ‘‘active duty’’. Subsec. (b)(3), (4). Pub. L. 102–484, § 4424(b)(3), redesig- nated par. (4) as (3) and struck out former par. (3) which read as follows: ‘‘if a Reserve, is on the active duty list; and’’. Subsec. (d)(1). Pub. L. 102–484, § 1052(16)(B), sub- stituted ‘‘before December 5, 1991’’ for ‘‘prior to the time this provision is enacted’’. Subsec. (e)(2). Pub. L. 102–484, § 4406(a)(1), substituted ‘‘may elect to have a reduction in the voluntary sepa- ration incentive payable for the same period in an amount not to exceed the amount of the basic pay or compensation received for that period.’’ for ‘‘shall for- feit an amount of voluntary separation incentive pay- able for the same period that is equal to the total amount of basic pay, or compensation, received.’’ Subsec. (e)(3). Pub. L. 102–484, § 4406(a)(2), inserted at end ‘‘If the member elected to have a reduction in vol- untary separation incentive for any period pursuant to paragraph (2), the deduction required under the pre- ceding sentence shall be reduced accordingly.’’ Subsec. (e)(6). Pub. L. 102–484, § 4406(b), struck out par. (6) which read as follows: ‘‘Years of service that form the basis of the payment under paragraph (5) may not be counted in computing eligibility for, or the amount of, annuities under title 5 or any other law providing annuities to Federal civilian employees.’’ Subsec. (j). Pub. L. 102–484, § 4405(b), added subsec. (j). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2013 AMENDMENT Pub. L. 112–239, div. A, title X, § 1076(a), Jan. 2, 2013, 126 Stat. 1947, provided that the amendment made by section 1076(a)(9) is effective Dec. 31, 2011, and as if in- cluded in Pub. L. 112–81 as enacted. EFFECTIVE DATE OF 2009 AMENDMENT Amendment by Pub. L. 111–32 applicable to any re- payments of separation pay, severance pay, readjust- ment pay, special separation benefit, or voluntary sep- aration incentive, that occur on or after June 24, 2009, including any ongoing repayment actions that were ini- tiated prior to such amendment, see section 318(c) of Pub. L. 111–32, set out as a note under section 1174 of this title. EFFECTIVE DATE OF 2002 AMENDMENT Amendment by Pub. L. 107–296 effective on the date of transfer of the Coast Guard to the Department of Homeland Security, see section 1704(g) of Pub. L. 107–296, set out as a note under section 101 of this title. EFFECTIVE DATE OF 2000 AMENDMENT Pub. L. 106–398, § 1 [[div. A], title V, § 572(b)], Oct. 30, 2000, 114 Stat. 1654, 1654A–136, provided that: ‘‘Subpara- graph (B) of section 1175(e)(3) of title 10, United States Code, as added by subsection (a), shall apply with re- spect to decisions by members to terminate voluntary separation incentive payments under section 1175 of title 10, United States Code, to be effective after Sep- tember 30, 2000.’’ EFFECTIVE DATE OF 1998 AMENDMENT Pub. L. 105–261, div. A, title V, § 563(c), Oct. 17, 1998, 112 Stat. 2028, provided that: ‘‘The amendments made by this section [amending this section] apply with re- spect to any person provided a voluntary separation in- centive under section 1175 of title 10, United States Code (whether before, on, or after the date of the enact- ment of this Act) [Oct. 17, 1998].’’ EFFECTIVE DATE OF 1994 AMENDMENT Amendment by Pub. L. 103–337 applicable only to members of the Coast Guard who are separated after Sept. 30, 1994, see section 542(e) of Pub. L. 103–337, set out as a note under section 1141 of this title. EFFECTIVE DATE OF 1992 AMENDMENT Amendment by section 4405(b) of Pub. L. 102–484 ap- plicable as if included in this section as enacted Dec. 5, 1991, with any benefits or services payable by reason of applicability of that amendment during the period be- ginning Dec. 5, 1991, and ending Oct. 23, 1992, to be sub- ject to availability of appropriations, see section 4405(c) of Pub. L. 102–484, set out as a note under section 1174a of this title. Pub. L. 102–484, div. D, title XLIV, § 4406(c), Oct. 23, 1992, 106 Stat. 2707, provided that: ‘‘The amendments to section 1175 of title 10, United States Code, made by subsections (a) and (b) shall apply as if included in sec- tion 1175 of title 10, United States Code, as enacted on December 5, 1991.’’ PAYMENT OF INCENTIVES FROM VOLUNTARY SEPARATION INCENTIVE FUND Pub. L. 104–208, div. A, title I, § 101(b) [title VIII, § 8044], Sept. 30, 1996, 110 Stat. 3009–71, 3009–98, provided that: ‘‘During the current fiscal year and hereafter, voluntary separation incentives payable under 10 U.S.C. 1175 may be paid in such amounts as are nec- essary from the assets of the Voluntary Separation In- centive Fund established by section 1175(h)(1).’’ Similar provisions were contained in the following prior appropriation acts: Pub. L. 104–61, title VIII, § 8054, Dec. 1, 1995, 109 Stat. 662. Pub. L. 103–335, title VIII, § 8062, Sept. 30, 1994, 108 Stat. 2633. Pub. L. 103–139, title VIII, § 8073, Nov. 11, 1993, 107 Stat. 1457. Pub. L. 102–396, title IX, § 9106, Oct. 6, 1992, 106 Stat. 1927. SEPARATION PAYMENTS; REDUCTIONS AND PROHIBITIONS For provisions reducing, with certain exceptions, amounts received under this section by amounts re- ceived as bonus payments under chapter 5 of title 37 in case of members who separate from active duty or full- time National Guard duty in a military department and prohibiting such members from receiving Vol- untary Separation Incentive program payments if re- hired in DOD civilian position within 180 days of sepa- ration, see note set out under section 1174a of this title. TAX TREATMENT OF INCENTIVE PAYMENT Pub. L. 102–190, div. A, title VI, § 662(b), Dec. 5, 1991, 105 Stat. 1398, provided that: ‘‘Notwithstanding the In- ternal Revenue Code of 1986 [26 U.S.C. 1 et seq.] and any other provision of law, any voluntary separation incen- tive paid to a member of the Armed Forces under sec- tion 1175 of title 10, United States Code (as added by subsection (a)), shall be includable in gross income for federal tax purposes only for the taxable year in which such incentive is paid to the participant or beneficiary of the member.’’ § 1175a. Voluntary separation pay and benefits (a) IN GENERAL.—Under regulations approved by the Secretary of Defense, the Secretary con- cerned may provide voluntary separation pay and benefits in accordance with this section to eligible members of the armed forces who are