About this entitlement
What you need to know — straight from the regulation
What Special and Incentive Pay is
Special and Incentive (S&I) pays are monetary incentives authorized under 37 U.S.C. Chapter 5 to attract and retain service members with specialized skills, unusual duties, or difficult assignments. S&I pays are paid on top of basic pay and are administered under the DoD Financial Management Regulation (FMR), Volume 7A.
The categories shown on this page — Aviation Incentive Pay, Career Sea Pay, Submarine Duty Pay, Hazardous Duty Incentive Pay, Special Duty Assignment Pay, Foreign Language Proficiency Bonus, Hostile Fire Pay / Imminent Danger Pay, Family Separation Allowance, and others — each have their own authority and eligibility rules in the relevant chapter of DoD FMR Vol. 7A.
37 U.S.C. Chapter 5 (Special and Incentive Pays) · DoD FMR Vol. 7A
Tax treatment
Most S&I pays are taxable wages and are included in the W-2. Exceptions include Combat Zone Tax Exclusion (CZTE) — when a member is serving in a designated combat zone, basic pay and many special pays are excluded from federal income tax for enlisted members (with a cap applied to officers). The Savings Deposit Program (SDP) offers a 10% annualized deposit rate for deployed members and is administered by DFAS.
IRS Publication 3 (Armed Forces' Tax Guide) · DoD FMR Vol. 7A
Source & references
- Primary source
- DFAS Special Pay Tables; DoD Financial Management Regulation Volume 7A — view official publication
- Regulatory reference
- DoD FMR Vol. 7A (Special & Incentive Pay chapters) · 37 U.S.C. Chapter 5
- Effective date
- January 1, 2026
- DFAS Special & Incentive Pay page
- https://www.dfas.mil/militarymembers/payentitlements/specialpay/
Military Toolkit is not affiliated with the Department of Defense, DFAS, DTMO, the Department of Veterans Affairs, or any government agency. Rates and rules on this page are pulled directly from the publications cited above. Always verify with your finance office, TMO, or the official rate page before making financial or planning decisions.
