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Updated December 26, 2019
Defense Primer: Regular Military Compensation
Congress sets compensation levels for members of the
the United States, this allowance is known as Basic
armed forces through statutory authorizations and
Allowance for Housing (BAH).
appropriations. When people talk about military pay, they
are often only referring to “basic pay.” Although basic pay
The amount of BAH a servicemember receives is based on
is normally the largest component of cash compensation
three factors: paygrade (rank), geographic location, and
that a servicemember receives, there are other types of
whether the servicemember has dependents. Paygrade and
military pay and allowances that add significantly to it, and
dependency status are used to determine the type of
tax benefits as well. Regular Military Compensation (RMC)
accommodation—or “housing profile”—that would be
is a statutorily defined measure of the cash or in-kind
appropriate for the servicemember (for example, one-
compensation elements which all servicemembers receive
bedroom apartment, two-bedroom townhouse, or three-
every payday. It is widely used as a basic measure of
bedroom single family home). Geographic location is used
military cash compensation levels and for comparisons with
to determine the average costs associated with each of these
civilian salary levels.
housing profiles in a given locality. The average costs of
these housing profiles are the basis for BAH rates, with
some additional adjustments made on the basis of paygrade
(that is, an E-7 without dependents will receive more than
For 2019, a mid-grade enlisted servicemember (E-5)
an E-6 without dependents, even though the appropriate
received an annual average of $35,785 in basic pay, but
housing profile for both of them is “two bedroom
an average of $64,544 in RMC.
apartment”). As a result of this methodology, BAH rates are
much higher in some areas than others. The intention is that
servicemembers of similar paygrade and dependents status
Regular Military Compensation (RMC)
are able to pay for roughly comparable housing regardless
RMC, as defined in law, is “the total of the following
of their duty location. Table 1 provides illustrative
elements that a member of the uniformed services accrues
examples of annual BAH.
or receives, directly or indirectly, in cash or in kind every
Basic Allowance for Subsistence
payday: basic pay, basic allowance for housing, basic
allowance for subsistence, and federal tax advantage
Nearly all servicemembers receive a monthly payment to
accruing to the aforementioned allowances because they are
defray their personal food costs, known as Basic Allowance
not subject to federal income tax.” Military compensation is
for Subsistence (BAS). BAS is provided at a flat rate. In
structured much differently than civilian compensation,
2019, enlisted personnel received $369.39 a month, while
making comparison difficult. RMC provides a more
officers received $254.39 a month. Those who do not
complete understanding of the cash compensation provided
receive BAS—for example, enlisted personnel in basic
to all servicemembers and therefore is usually preferred
training—receive government-provided meals.
over basic pay when comparing military with civilian
Federal Tax Advantage
compensation, analyzing the standards of living of military
personnel, or studying military compensation trends.
While the various types of military pay—basic pay, special
pay, and incentive pay—are considered part of gross
Basic Pay
income and are usually subject to federal income tax,
For most servicemembers, basic pay is the largest element
military allowances are generally not subject to federal
of the compensation they receive in their paycheck and
income tax. The tax advantage generated by the exemption
typically accounts for about two-thirds of an individual’s
of the housing and subsistence allowances from federal
RMC. All members of the Armed Forces receive basic pay,
income tax is a part of RMC. Table 1 provides the
although the amount varies by pay grade (rank) and years of
estimated tax advantage for the illustrative examples, but
service (also called longevity). Table 1 provides illustrative
the precise value of the federal tax advantage for an
examples of basic pay rates.
individual servicemember will vary depending on his or her
unique tax situation.
Basic Allowance for Housing
Compensation Elements Not Included in RMC
All servicemembers are entitled to either government-
provided housing or a housing allowance. About 40% of
Special pays and bonuses, travel reimbursements,
servicemembers receive government-provided housing (in
educational assistance, deferred compensation (i.e., an
the form of barracks, dormitories, ship berthing, or
economic valuation of future retired pay and benefits), or
government-owned family housing). The remainder receive
any estimate of the cash value of non-monetary benefits
a housing allowance to offset the costs of the housing they
such as health care, child care, recreational facilities,
rent or purchase in the civilian economy. For those living in
commissaries, and exchanges are excluded from RMC. As
the value of these forms of compensation can be substantial,
https://crsreports.congress.gov
Defense Primer: Regular Military Compensation
RMC should not be considered a measure of total military
compensation.
Table 1. Average Regular Military Compensation for Selected Paygrades
2019 data; assumes al cash pay (e.g., BAH instead of government quarters)
Estimated
Average
Average
Average
Annual
Average
Annual
Annual
Federal
Average
Pay
Annual
Housing
Subsistence
Tax
Annual
Grade
Rank
Basic Pay
Allowance
Allowance
Advantage
RMC
E-1
Private (Army and Marine Corps) Seaman
$20,171
$14,020
$4,433
$2,554
$41,177
Recruit (Navy)
Airman Basic (Air Force)
E-5
Sergeant (Army and Marine Corps)
$35,785
$19,503
$4,433
$4,823
$64,544
Petty Officer Second Class (Navy)
Staff Sergeant (Air Force)
E-8
Master Sergeant or First Sergeant (Army
$64,055
$24,069
$4,433
$4,189
$96,746
and Marine Corps)
Senior Chief Petty Officer (Navy)
Senior Master Sergeant or First Sergeant
(Air Force)
O-1
Second Lieutenant (Army, Air Force and
$39,210
$17,827
$3,053
$4,111
$64,200
Marine Corps)
Ensign (Navy)
O-4
Major (Army, Air Force and Marine
$91,706
$28,064
$3,053
$7,623
$130,446
Corps)
Lieutenant Commander (Navy)
O-6
Colonel (Army, Air Force and Marine
$135,118
$32,433
$3,053
$10,105
$180,709
Corps)
Captain (Navy)
Source: Department of Defense, Selected Military Compensation Tables, 1 January 2019, B3, available at
https://militarypay.defense.gov/Portals/3/Documents/Reports/GreenBook%202019.pdf?ver=2019-04-11-214259-563. Rates rounded to nearest
dol ar; rows may not sum exactly due to rounding. E-1 rates exclude E-1s with fewer than four months of service. O-1 rates excludes officers
with prior enlisted experience who qualify for the O-1E rate. Note that this publication computes the estimated average annual federal tax
advantage using the standard deduction and 2011 tax rates, including earned income tax credit. The actual annual tax advantage of
servicemembers wil vary based on their unique tax situation.
Relevant Statutes
Title 37, U.S. Code, Chapter 3—Basic Pay
Other Resources
Title 37, U.S. Code, Chapter 7—Al owances Other Than Travel
and Transportation Allowances
Defense Finance and Accounting Service, 2019 Military Pay
Chart
26 U.S.C. §134 (Exclusion of qualified military benefits from
gross income)
Defense Travel Management Office, BAH Calculator
DOD Financial Management Regulations, Volume 7A, Chapter
1 (Basic Pay) and Chapter 25 (Subsistence Allowances).
Joint Travel Regulations, Chapter 10 (Housing Allowances)
CRS Products
Military Compensation Background Papers, 8th Edition
CRS Report RL33446, Military Pay: Key Questions and Answers,
by Lawrence Kapp and Barbara Salazar Torreon
Lawrence Kapp, Specialist in Military Manpower Policy
IF10532
https://crsreports.congress.gov
Defense Primer: Regular Military Compensation
Disclaimer
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