10 U.S.C. § 638b — Voluntary retirement incentive

(a) Voluntary-retirement incentive. The Secretary of Defense may authorize a military-department Secretary to pay^* an incentive under this section to an armed-forces officer^* under that Secretary’s authority who qualifies under subsection (c).

(b) Limits. (1) The authority ends when the Secretary of Defense specifies, but no later than December 31, 2018. (2) No more than 675 officers may receive a payment.

(c) Eligible officers. (1) Unless paragraph (2) excludes the officer, an officer qualifies if, on the approved retirement date, the officer: (A) has more than 20 but no more than 29 years of active duty^*; (B) meets the minimum commissioned-service requirement for voluntary retirement under the applicable section 7311, 8323, or 9311; (C) has at least 12 months of active-duty service remaining before reaching the maximum active-service retirement years for the officer’s grade^* under section 633 or 634; (D) has at least 12 months remaining before reaching the maximum retirement age under any other law; and (E) meets any extra requirements set by the Secretary concerned^*, including requirements about service years, skill rating^*, specialty or competitive category, grade, remaining obligated service, or any combination. (2) The following officers do not qualify: (A) an officer being evaluated for disability under chapter 61; (B) an officer expected to retire under section 1201 or 1204; (C) an officer expected to be discharged with disability severance pay under section 1212; (D) a member transferred to the temporary disability retired list under section 1202 or 1205; or (E) an officer facing pending discipline, administrative separation, or mandatory discharge under another law or regulation.

(d) Payment. The Secretary concerned sets the payment, but it may not exceed 12 times the officer’s monthly basic pay at retirement. It may be paid as a lump sum at retirement.

(e) Repayment after returning to active duty. (1) Unless paragraph (2) applies, a member who received all or part of the incentive and returns to active duty must repay it through deductions from each basic-pay payment, in monthly installments set by the Secretary concerned, until the deductions equal the incentive received. (2) This repayment rule does not apply to members involuntarily recalled to active duty or full-time National Guard duty^* under any law. (3) The Secretary of Defense may waive all or part of repayment if recovery would be unfair or against the United States’ best interests. Only the Under Secretary of Defense for Personnel and Readiness and the Principal Deputy Under Secretary of Defense for Personnel and Readiness may receive a delegation of this authority.