B-167728, SEP 11, 1969

B-167728: Sep 11, 1969

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

WHO RETURNED PAY ADJUSTMENT CHECK BECAUSE HE BELIEVED HE SHOULD HAVE RECEIVED A LUMP-SUM TAX FREE REENLISTMENT BONUS IS FOUND TO BE INDEBTED ON THE BASIS THAT THE RECORD CORRECTION CREATED AN OVERPAYMENT OF THE REENLISTMENT BONUS AND THE VARIABLE REENLISTMENT BONUS. MEMBER IS NOW ENTITLED TO THE BONUSES AS OF AUGUST 20. HOWEVER SINCE HE WAS NOT IN A COMBAT ZONE THE EXEMPTION FROM TAXES IS NOT TO BE INVOKED. SECRETARY: THERE IS BEFORE THIS OFFICE FOR CONSIDERATION THE SETTLEMENT FOR MONETARY BENEFITS MADE TO STAFF SERGEANT DAVID A. HE WAS DISCHARGED ON NOVEMBER 15. HE WAS PAID A REGULAR REENLISTMENT BONUS IN THE AMOUNT OF $1. SINCE HE WAS AT THAT TIME SERVING IN A COMBAT ZONE NO TAXES WERE WITHHELD FROM THOSE PAYMENTS.

B-167728, SEP 11, 1969

MILITARY - REENLISTMENT BONUS - RECORD CORRECTION VOLUNTARY DECISION TO SECRETARY OF THE NAVY CONCERNING MONETARY BENEFITS DUE MEMBER INCIDENT TO A RECORD CORRECTION ACTION. MEMBER WHO HAD RECORD CORRECTED TO SHOW SUFFICIENT CONTINUOUS SERVICE FOR A VARIABLE REENLISTMENT BONUS THAT HE HAD ERRONEOUSLY RECEIVED, BUT WHO RETURNED PAY ADJUSTMENT CHECK BECAUSE HE BELIEVED HE SHOULD HAVE RECEIVED A LUMP-SUM TAX FREE REENLISTMENT BONUS IS FOUND TO BE INDEBTED ON THE BASIS THAT THE RECORD CORRECTION CREATED AN OVERPAYMENT OF THE REENLISTMENT BONUS AND THE VARIABLE REENLISTMENT BONUS. MEMBER IS NOW ENTITLED TO THE BONUSES AS OF AUGUST 20, 1967, AND HE MAY RETAIN THE PROFICIENCY PAY ACCRUING AFTER THAT DATE. HOWEVER SINCE HE WAS NOT IN A COMBAT ZONE THE EXEMPTION FROM TAXES IS NOT TO BE INVOKED.

TO MR. SECRETARY:

THERE IS BEFORE THIS OFFICE FOR CONSIDERATION THE SETTLEMENT FOR MONETARY BENEFITS MADE TO STAFF SERGEANT DAVID A. SHAW, 1885610, U.S. MARINE CORPS, BY THE MARINE CORPS FINANCE CENTER BY REASON OF THE CORRECTION OF HIS MILITARY RECORDS MADE PURSUANT TO 10 U.S.C. 1552.

THE RECORDS, AS PRESENTED TO THIS OFFICE, INDICATE THAT WHILE A MEMBER OF THE U. S. MARINE CORPS RESERVE, SERGEANT SHAW ENTERED ON ACTIVE DUTY FOR A PERIOD OF 2 YEARS ON NOVEMBER 18, 1965. DURING HIS SERVICE IN THE FAR EAST, HE WAS DISCHARGED ON NOVEMBER 15, 1966, AND REENLISTED ON NOVEMBER 16, 1966, IN THE REGULAR MARINE CORPS FOR A PERIOD OF 6 YEARS. HE WAS PAID A REGULAR REENLISTMENT BONUS IN THE AMOUNT OF $1,726.20 AND A LUMP SUM VARIABLE REENLISTMENT BONUS OF $5,178.60. SINCE HE WAS AT THAT TIME SERVING IN A COMBAT ZONE NO TAXES WERE WITHHELD FROM THOSE PAYMENTS. THE RESULT OF HIS REENLISTMENT IT APPEARS THAT SERGEANT SHAW HAS RECEIVED PROFICIENCY PAY FROM NOVEMBER 16, 1966.

IT WAS SUBSEQUENTLY DETERMINED THAT SERGEANT SHAW WAS NOT ENTITLED TO THE PAYMENT OF VARIABLE REENLISTMENT BONUS SINCE HE DID NOT HAVE THE REQUIRED 21 MONTHS OF ACTIVE SERVICE IMMEDIATELY PRIOR TO HIS REENLISTMENT AND ON JUNE 6, 1967, A PAY ADJUSTMENT AUTHORIZATION WAS ISSUED AUTHORIZING A CHARGE IN HIS PAY ACCOUNT IN THE AMOUNT OF $5,178.60. ON AUGUST 19, 1967, HE MADE APPLICATION FOR REMISSION OF THE INDEBTEDNESS AND THE CHECK AGE AGAINST HIS ACCOUNT WAS SUSPENDED. HE ALSO PETITIONED THE BOARD FOR CORRECTION OF NAVAL RECORDS FOR RELIEF. NO ACTION WAS TAKEN ON HIS REQUEST FOR REMISSION OF THE INDEBTEDNESS SINCE THE CORRECTION BOARD ACCEPTED HIS APPLICATION.

ON AUGUST 27, 1968, THE ASSISTANT SECRETARY OF THE NAVY APPROVED THE CORRECTION BOARD'S RECOMMENDATION THAT SERGEANT SHAW'S NAVAL RECORD BE CORRECTED TO SHOW THAT HE WAS DISCHARGED ON AUGUST 19, 1967, AND REENLISTED ON AUGUST 20, 1967, OR SUCH OTHER DATES AS WOULD PROPERLY REFLECT ACCOMPLISHMENT OF 21 MONTHS OF CONTINUOUS ACTIVE DUTY PRIOR TO REENLISTMENT, INSTEAD OF BEING DISCHARGED ON NOVEMBER 15, 1966, AND REENLISTED ON NOVEMBER 16, 1966, AND THAT HE, OR OTHER PROPER PARTY OR PARTIES, BE PAID ALL MONIES LAWFULLY FOUND TO BE DUE FROM THE DEPARTMENT OF THE NAVY AS A RESULT OF THE CORRECTIVE ACTION.

THEREAFTER THE MARINE CORPS FINANCE CENTER PREPARED A MILITARY PAY AND ALLOWANCE CLAIMS VOUCHER SHOWING THE MONETARY BENEFITS DUE UNDER THE RECORD CORRECTION AS OF AUGUST 20, 1967, TO BE REENLISTMENT BONUS OF $1,726.20 ($287.70 X 6) AND VARIABLE REENLISTMENT BONUS 3 (FULL PAYMENT) IN THE AMOUNT OF $5,178.60. THE REENLISTMENT BONUS PAID ON NOVEMBER 16, 1966, WAS DEDUCTED AND THE VARIABLE REENLISTMENT BONUS WAS DEEMED TO BE PAYABLE. BECAUSE SERGEANT SHAW WAS NOT IN A COMBAT ZONE ON AUGUST 20, 1967, FEDERAL WITHHOLDING TAX IN THE AMOUNT OF $1,380.96 WAS DEDUCTED AND CHECK NO. 2,099,768, DATED OCTOBER 14, 1968, IN THE AMOUNT OF $3,797.64, DRAWN IN HIS FAVOR, WAS TENDERED TO HIM AS PAYMENT OF ALL MONETARY BENEFITS DUE ON THE BASIS OF THE CORRECTION ACTION TAKEN UNDER 10 U.S.C. 1552.

SERGEANT SHAW RETURNED THE CHECK FOR THE REASON THAT HE UNDERSTOOD HE WOULD RECEIVE A LUMP SUM TAX FREE REENLISTMENT BONUS AND THAT IF THE PAYMENT COULD NOT BE TAX FREE HE REQUESTED THAT THE PAYMENT BE MADE IN FIVE EQUAL YEARLY INSTALLMENTS IN ORDER THAT HIS TAX OBLIGATION WOULD BE REDUCED. THE MATTER WAS THEN REFERRED HERE BY THE MARINE CORPS FINANCE CENTER FOR "FINAL DISPOSITION" BY LETTER DATED JANUARY 28, 1969, COPY HEREWITH. HOWEVER, IT WOULD SEEM THAT ON THE PRESENT RECORD DISPOSITION OF THE CASE SHOULD BE MADE BY THE MARINE CORPS.

THE RECORD CORRECTION CHANGING THE DATE OF SERGEANT SHAW'S DISCHARGE TO AUGUST 19, 1967, AND THE DATE OF HIS REENLISTMENT TO AUGUST 20, 1967, AND EXPUNGING FROM HIS RECORD HIS DISCHARGE OF NOVEMBER 15, 1966, AND HIS REENLISTMENT OF NOVEMBER 16, 1966, NOT ONLY CREATED AN OVERPAYMENT OF THE REENLISTMENT BONUS AND VARIABLE REENLISTMENT BONUS IN THE AMOUNT OF $6,904,80 MADE TO HIM AT THAT TIME BUT, IN ADDITION REMOVED HIS ENTITLEMENT TO THE AMOUNT OF THE PROFICIENCY PAY WHICH HE WAS PAID FROM NOVEMBER 16, 1966 TO AUGUST 19, 1967. THUS, IN ADJUSTING HIS PAY ACCOUNT ON THE BASIS OF THE CORRECTED RECORD THE TOTAL AMOUNT OVERPAID SHOULD BE TAKEN INTO CONSIDERATION.

SINCE SERGEANT SHAW WAS NOT ENTITLED TO THE VARIABLE REENLISTMENT BONUS PAID IN NOVEMBER 1966, THE APPROVAL OF THE COMMANDANT OF THE MARINE CORPS OF PAYMENT IN ONE LUMP SUM WAS OF NO EFFECT. WHILE FINAL DISPOSITION OF THIS MATTER MAY NOT BE MADE AT THIS TIME ON THE BASIS OF THE CORRECTED RECORDS, SERGEANT SHAW IS NOW ENTITLED TO REENLISTMENT BONUS AND VARIABLE REENLISTMENT BONUS AS OF AUGUST 20, 1967, AND HE MAY RETAIN THE PROFICIENCY PAY WHICH ACCRUED ON AND AFTER THAT DATE, BUT FROM THE AMOUNTS DUE THE OVERPAYMENTS ALREADY MADE TO HIM SHOULD BE SET OFF.

THEREFORE, WE WOULD HAVE NO OBJECTION TO THE CREDITING AGAINST HIS INDEBTEDNESS OF THE AMOUNT OF THE PROPER REENLISTMENT BONUS DUE ON AUGUST 20, 1967, AND 3 INSTALLMENTS OF 1/6 OF THE VARIABLE REENLISTMENT BONUS DUE AS OF AUGUST 20, 1967, AUGUST 20, 1968, AND AUGUST 20, 1969, LESS WITHHOLDING TAX. SINCE HE WAS NOT IN A COMBAT ZONE ON AUGUST 20, 1969, HE WAS NOT ENTITLED TO EXEMPTION FROM TAXES.

SINCE THE PROCEEDS OF CHECK NO. 2,099,768 ARE NOT DUE SERGEANT SHAW, IT AND THE PAPERS FORWARDED WITH LETTER DATED JANUARY 28, 1969, OF THE MARINE CORPS FINANCE CENTER, ARE ENCLOSED HEREWITH FOR APPROPRIATE DISPOSITION.