What Do I Do With My Reenlistment Bonus?
Pay Down Debt In fact, using your reenlistment bonus to reduce debt is one of the best things you can do with the money. For each debt you're able to pay off in full, you save money on interest, and free up that much more money on a monthly basis.
If you receive a bonus, you are on the hook for the term of your contract. You may owe a prorated refund to the government if you are unable to fulfill the terms of your contract. This will be based on the amount of money you have received and how much time remains on your contract.
Enlistment and Reenlistment Bonus Guide - The Military Wallet
The bonus is usually paid in a lump sum of 50% paid at the time of reenlistment. The remaining bonus amount is paid in equal annual installments. It is taxable, however if you reeenlist in a tax-free combat zone or are a foreign national who reenlists OCONUS it is not taxable, and the installments are also tax-free.
The Selective Reenlistment Bonus (SRB) - Military.com
Military bonuses are subject to taxation at the time of payment. Past rules (mentioned earlier in this article) issued by the Internal Revenue Service required the Defense Accounting And Finance Service (DFAS) to withhold 25% of that bonus (later reduced to 22%) on payment.
Taxes on Military Bonuses - Veteran.com
Bonuses are paid in Lump Sum, at the time of re-enlistment. Member must have been separated for more than 90 days, but less than 4 years.
Army Enlistment and Re-Enlistment Bonuses - The Balance Careers