Savings Deposit Program
Earn an extra 10% from Uncle Sam while deployed to OIF, OEF or another combat zone.
Marines and all US Armed Forces personnel serving deployed in combat zones, qualified hazardous duty areas, or certain contingency operations may be eligible to deposit all or part of their unallotted pay into a DOD savings account up to $10,000 during a single deployment. on the account at an annual rate of 10% and compounds quarterly.
The Savings Deposit program provided Vietnam veterans a way to earn extra money while on their Southeast Asia tours. DOD reopened the program to Desert Storm troops in 1991, and extended it to troops in Bosnia in 1996. The program was further expanded in 1997, 2001, and 2003.
Although federal income earned in hazardous duty zones is tax-free, interest accrued on earnings deposited into the SDP is taxable. Marines can designate the allotment amount in five-dollar increments and deposits may be discontinued at any time. Funds can be left in an SDP account indefinitely, however, the account will stop accruing interest 90 days after a member returns from the combat zone. Withdrawls generally may only be made upon termination of eligibility for the program.
- Marines serving in specified combat zones or in support of a contingency operation are authorized to make deposits. Service members must be in receipt of Hostile Fire Pay and be deployed for at least 30 consecutive days or at least 1 day in each of 3 consecutive months. Marines should contact their Finance Office to verify their eligibility.
- There is no limit on the amount that may be contributed; however, no interest is paid on amounts exceeding $10,000.00. If you are depositing by allotment it will not stop automatically when the balance reaches $10,000.00. You must monitor the balance and request the allotment be stopped.
- The interest rate is 10% annually, earned at 2.5% per quarter. No interest is paid on amounts exceeding $10,000.00. Deposits made by the 10th of a month will earn interest from the 1st of that month. Deposits made after the 10th accrue interest from the first day of the following month. Your account will continue to earn interest for 90 days after leaving the combat zone. Combat zone departure must be posted in order for interest accrual to be correctly stopped.
- Remember the interest is taxable. Combat zone rules do not apply. No federal or state tax is withheld. A 1099-INT is issued no later than January 31st for Savings Deposit Program interest. If you do not receive your 1099-INT in the mail you may contact Customer Support to request that it be reissued to you.
- Marines use the program by arranging deposit through their unit Admin. Marines may begin making deposits on their 31st consecutive day in the designated area. Eligibility to make deposits terminates on the date of departure from theater. Active duty members may make deposits by cash, personal check, traveler’s check, money order or allotment.
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The Centralized Customer Support Unit at 1-888-DFAS411 or 1-888-332-7411, or commercial (216) 522-5096, or Defense Switching Network (DSN) 580-5096 (7:00 A.M. – 6:30 P.M. / Eastern time).
Resources:
DFAS MYPAY (SDP)
II MEF OIF Pre-deployment brief
Posted by Leading Marines.com at 11/1/2008 11:06 PM 
Categories: General Leadership, Taking care of Marines
Categories: General Leadership, Taking care of Marines
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