Noncontributory Social Security Wage Credits for Military Service Should Be Eliminated

FPCD-79-57: Published: Aug 8, 1979. Publicly Released: Aug 8, 1979.

Additional Materials:


Kenneth J. Coffey
(202) 275-5140


Office of Public Affairs
(202) 512-4800

Military service was brought under contributing social security coverage in 1957. Both military members and the Department of Defense (DOD), as their employer, pay social security taxes on basic pay.

Members whose basic pay is less than the social security taxable earnings ceiling are credited with additional covered earnings of up to $1,200 a year in excess of basic pay. Neither the member nor DOD pays taxes on these credits. The social security trust funds are reimbursed annually from the general fund of the Treasury for additional costs attributable to the noncontributory credits. GAO reviewed the rationale for providing noncontributory credits for service performed after 1956, examined their effects on current benefits, and estimated unforeseen costs that will result.

Matter for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: On July 28, 1982, GAO sent a followup letter to the House Ways and Means Committee and the Senate Finance Committee pointing out again that the noncontributory wage credits are no longer justified. The committees considered this issue, but decided to take no action. Therefore, further followup on this issue is not warranted.

    Matter: Congress should terminate noncontributory social security wage credits for future military service. This result may be achieved by amending Section 429, title 42, U.S. Code to limit noncontributory credits to service performed before 1980.


Explore the full database of GAO's Open Recommendations »

Sep 16, 2020

Feb 25, 2020

Dec 30, 2019

Oct 10, 2019

Oct 2, 2019

Sep 25, 2019

Sep 11, 2019

Aug 15, 2019

Jul 30, 2019

May 23, 2019

Looking for more? Browse all our products here