BRAC vs. annual leave


Q: Could you tell me if the payout on Base Closure and Realignment Leave and the payout for annual leave is the same? I was told that the BRAC payout is taxed at a higher rate.

A. Both are taxed at the same rate. The IRS considers lump-sum payments to be regular income, with deductions being taken out for federal taxes and, where applicable, state taxes and Social Security.


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Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to

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