37 U.S.C. § 501 — Payments for unused accrued leave

(a) "Discharge" means, depending on the situation: (1) for an enlisted member, honorable separation or release, ending an enlistment right before starting a new one (regardless of when the old enlistment's term would have ended), or becoming an officer; (2) for an officer, honorable separation or release; (3) for either an officer or enlisted member, dying while on active duty, unless the death was a lawful execution for a crime or military offense; (4) for a reserve or Space Force officer or enlisted member not on active duty, honorable separation or release from the reserves or Space Force, or death; and (5) for a reserve or Space Force enlisted member not on active duty, ending an enlistment right before a new one starts, or becoming an officer. (b) Payment for leave. (1) A member of the Army, Navy, Air Force, Marine Corps, Space Force, Coast Guard, or NOAA who has unused leave when discharged is entitled to cash payment (or a Treasury check), based on the basic pay they were earning on their discharge date. (2) No payment if the member is discharged only to accept an appointment or warrant in another uniformed service. (3) No payment for leave a member chooses to carry over into a new enlistment in any uniformed service starting the day after discharge — but payment is available for leave they choose not to carry over. Either way, the total days paid can't exceed 60, minus any days already paid under this section since February 9, 1976. (4) A member who can't be paid under this rule, or who moves from officer back to enlisted status, keeps their accrued leave balance carried over between those situations, within any uniformed service. (5) The 60-day cap in (3) and in subsection (f) doesn't apply to leave built up: (A) by a reserve or Space Force member serving active duty in support of a contingency operation; (B) by a Retired Reserve member serving active duty in support of a contingency operation; (C) by certain retired Regular or Reserve members serving active duty in support of a contingency operation; or (D) by a reserve or Space Force member serving active duty, full-time National Guard duty, or active duty for training, for more than 30 but no more than 365 days. (6) An enlisted member who would otherwise lose leave beyond 90 days under section 701(e) of title 10 can instead choose to be paid in cash for up to 30 of those extra days. A member can only make this choice once. (c) Leave paid for under (b) doesn't count as service for any other purpose. (d) (1) If a member dies while on active duty, or dies after retiring or being discharged but before receiving their leave payment, the payment follows section 2771 of title 10. For a member who dies on active duty, the payment covers unused leave carried into that leave year, plus leave that accrued during that year. (2) The limits in (b)(3), (f), and (g) don't apply to a payment made under this subsection. (e) (1) A member of the Army, Navy, Air Force, Marine Corps, Space Force, Coast Guard, or NOAA who is discharged under other-than-honorable conditions forfeits all their accrued leave. (2) The relevant Secretary can also require a member discharged before completing six months of active duty — because of unsatisfactory service — to forfeit all accrued leave. (f) Payments under (b) or (g) can't be based on more than 60 days, minus days already paid under those subsections since February 9, 1976. This 60-day count ignores any break in service or change in status. (g) A Regular Corps officer of the Public Health Service, or a Reserve Corps officer on active duty, who has accumulated and accrued annual leave on the date they separate, retire, or leave active duty, gets paid a lump sum for it — if the Secretary of Health and Human Services approves — based on their basic pay, subsistence allowance, and quarters allowance (even if not currently receiving housing allowance). This payment is still subject to the 60-day cap in (f). No lump-sum payment goes to an officer who (1) accepts a new appointment without a break in service when their old one expires or ends; (2) is retired for age during wartime but stays on or returns to active duty without a break in service; or (3) transfers to another federal department or agency where another law lets their leave transfer instead. "Accumulated annual leave" means leave carried over from one leave year to the next; "accrued annual leave" means leave earned during the current leave year. (h) Payment for all leave built up under section 701(f) of title 10 must be made as soon as possible once the person's name is removed from missing status, as defined in section 551(2) of this title.