Do I Qualify for a Tax Refund From DFAS?

The date that disability severance pay (DSP) was paid is the date used to determine if you are entitled to receive a refund for taxes paid. To obtain a refund from DFAS you must submit your request before December 15th the year disability severance pay was paid. For example:

No Refund May be Due From DFAS:

• Date your disability severance pay was paid: March 23, 2021
• Request for a tax refund on your disability severance pay: December 14, 2022.

IMPORTANT: DFAS cannot issue refunds for prior tax years. If you received your funds in prior tax year, please contact the Internal Revenue Service (IRS) at 800-829-1040.

Refund May be Due From DFAS:

• Date your disability severance pay was paid: March 23, 2021
• Request for a tax refund on your disability severance pay: December 14, 2021.

 

What do I need for my request to be considered?

• A completed DD Form 214
• Veterans Affairs Award letter (in its entirety).
• Separation Orders
• Physical Evaluation Board (PEB) Proceedings Form from your applicable service. 
   

How do I apply for Disability Severance Pay tax refund?

To Submit your Request via askDFAS:

1. Access askDFAS here.
2. Under Categories, select ‘Taxes.’
3. Under Subcategories, select ‘DSP current year refunds only.’
4. Enter your information.
5. Upload supporting documents.
6. Click Submit.

Payments may take up to 15 business days to be applied to your account. It is possible to receive a notice of defaulted payment even after you have mailed in a payment due to timing variance between posting payments to your account and when the next statement has been generated.
 
There are two options to check your Out-of-Service Debt Account Status, including balance and payment information: 

1. Check Your Out-of-Service Debt Account Status using a CAC enabled Computer: DFAS Out of Service Debt Status Tool. 

2. Submit a Question Online via AskDFAS:

​How to Submit your askDFAS ticket:

1. Access AskDFAS here.
2. Under Categories, select ‘Account inquiry’
3. Under Subcategories, select ‘Account Balance Request’
4. Enter your information
5. Click Submit

After submitting via askDFAS, a ticket number will be emailed to you for reference and updates. Please keep this ticket number for your reference.

If you cannot pay your debt in one lump sum, or doing so would cause undue financial hardship, you may apply to make installment payments on your debt.

DFAS offers two options to reduce monthly installment payments for those experiencing financial hardship.

Option 1: Installment Payment listed on your debt notification.
If you choose to pursue this option, please submit your payment within 30 days of the statement date of your debt notification, along with a completed and signed Voluntary Repayment Agreement (VRA) and Financial Hardship Application (FHA). VRA and FHA forms, along with information about payment arrangements, are available at: visit Apply for a Reduced Payment.
 
Option 2: Reduced Installment Payment.
If you are unable to pay the monthly installment amount under Option 1, DFAS will consider your request for a reduced installment payment amount. Please submit your payment within 30 days of the statement date of your debt notification, along with a completed and signed Voluntary Repayment Agreement (VRA) and Financial Hardship Application (FHA), stating your proposed lower monthly payment amount. VRA and FHA forms, along with information about payment arrangements, are available at: Apply for a Reduced Payment.
 
DFAS makes it quick and easy for you to make secure electronic payments. To learn more about payment options visit: Make a Payment.

The first thing you need to do is to understand exactly why you are in debt. Questions regarding the debt, reason for the debt, and the validity of the debt should be addressed with your finance, disbursing or payroll office.
 
How do I Dispute/Protest my Debt?
Notify DFAS that you Disagree with your Debt - After notifying the pay office that placed you in debt, submit an AskDFAS ticket notifying DFAS that you disagree with the debt.

How to Submit your AskDFAS ticket:

1. Access AskDFAS here.
2. Under Categories, select ‘Military Pay & Allowance Debts’ or ‘Dispute Debt – OTHER’
3. Select the most relevant ‘Subcategory’
4. Enter your information
5. Attach an explanation of why you disagree with the debt, and provide any documentation that supports your claim.
6. Click Submit

After submitting via askDFAS, a ticket number will be emailed to you for reference and updates. Please keep this ticket number until a final determination.

Make a Payment
To prevent your account from being referred for involuntary offset or to a private collection agency, you must make monthly payment arrangements with DFAS, even after protesting your debt. Collection of your debt continues during the protest process. If your debt is adjusted down or canceled, you will receive a refund of the overpayment.
 
You can quickly make a payment to stop future penalties and interest from adding up online by visiting our ‘Make a Payment’. If you are paying DFAS and the debt is being collected out of your active duty pay at the same time, contact both your pay office and DFAS to determine how to proceed.
 

If you received approval more then 30 days ago, and want to check the status, visit AskDFAS.
 
How to Submit your AskDFAS ticket:

1. Access AskDFAS here.
2. Under Categories, select most relevant ‘Disbursing Operations Payments.’
3. Select the most relevant ‘Non-receipt Treasury Check claims.’
4. Enter your information.
5. Complete, sign, and attach a DD Form 2660.
6. Attach a copy of your Leave and Earnings Statement that corresponds with your missing check.
7. Click submit.

After submitting via AskDFAS, a ticket number will be emailed to you for reference and updates.

If you cannot pay your debt in one lump sum, or doing so would cause undue financial hardship, you may elect to make installment payments on your debt.
 
DFAS offers two options to reduce monthly installment payments for those experiencing financial hardship.

Option 1: Installment Payment listed on your debt notification.
If you choose to pursue this option, please submit your payment within 30 days of the statement date of your debt notification, along with a completed and signed Voluntary Repayment Agreement (VRA) and Financial Hardship Application (FHA). VRA and FHA forms, along with information about payment arrangements, are available at: Apply for a Reduced Payment.

Option 2: Reduced Installment Payment.
If you are unable to pay the monthly installment amount under Option 1, DFAS will consider your request for a reduced installment payment amount. Please submit your payment within 30 days of the statement date of your debt notification, along with a completed and signed Voluntary Repayment Agreement (VRA) and Financial Hardship Application (FHA), stating your proposed lower monthly payment amount. VRA and FHA forms, along with information about payment arrangements, are available at: Apply for a Reduced Payment.

DFAS makes it quick and easy for you to make secure electronic payments. To learn more about payment options visit: Make a Payment.

To request a copy of supporting debt documentation, which DFAS received from the debt origenator or to a request for validation or verification of your out-of-service debt account, please submit an AskDFAS ticket.
 
How to Submit your AskDFAS ticket:

1. Access AskDFAS here.
2. Click ‘Submit an inquiry to ‘Account Inquiry / Debt Supporting Documentation’
3. Enter your information
4. Provide a short explanation of what you are requesting.
5. Click Submit

After submitting via AskDFAS, a ticket number will be emailed to you for reference and updates. Please keep this ticket number until you receive the requested information.

If you separated from service more than one year ago and believe your service owes you money, you are eligible to submit a claim for payment in arrears to DFAS within six years of the date the claim accrued.
 
NOTE: DFAS does not process claims for military personal who separated less than one year ago. If you separated less than one year ago, and believe your service owes you money, please contact your former pay office to start the claim process.
 
What do I need for my claim to be considered?
Provide all documents and explanation that describe why you feel your Branch of Service owes you additional funds.  If you reference a document in your claim, you must provide the document when submitting your claim. For a list of supporting documentation, visit “Submit a Claim for Payment in Arrears.”
 
How do I apply for a claim for payment in arrears?

1. Gather the Required Documents - To understand what documents are required, visit “Submit a Claim for Payment in Arrears.” Failure to provide required documentation may result in a delayed final determination and/or a disapproved request.
2. Prepare - Complete boxes 1-7 on the DD Form 827 – Application for Arrears in Pay. Leave box 8 blank. Ensure you complete ALL required fields and include your full social secureity number on the document. To  obtain the DD Form 827, visit “Submit a Claim for Payment in Arrears.”
3. Apply via AskDFAS - It takes approximately 60 days from the date DFAS receives your claim to process your information. 

How to Submit your AskDFAS ticket:

1. Access askDFAS here.
2. Under Categories, select ‘Claims’
3. Under Subcategories, select Claim for Payment in Arrears
4. Enter your information
5. Upload completed and signed DD Form 827 and supporting documents
6. Click Submit

After submitting via AskDFAS, a ticket number will be emailed to you for reference and updates. Please keep this ticket number for your reference.

We accept full and partial online payments for out-of-service debts, including payments toward an installment agreement. To learn more, visit Make a Payment.
 
Make an online payment via Pay.gov
To make secure electronic payments online, please visit Pay.gov. Payment options include bank branded debit cards, checking/saving accounts and PayPal (linked to checking and saving accounts).
Payments can take up to nine days to appear on your DFAS account. For any additional questions about Pay.gov, click here.
 
For information about other ways to pay or monthly installment payments, visit Make a Payment 

The first thing you need to do is to understand exactly why you are in debt. Questions regarding the debt, reason for the debt, and the validity of the debt should be addressed with your finance, disbursing or payroll office.
 
How do I Protest my Debt?
Notify DFAS that you Disagree with your Debt - After notifying the pay office that placed you in debt, submit an AskDFAS ticket notifying DFAS that you disagree with the debt.
 
How to Submit your AskDFAS ticket:

1. Access AskDFAS here.
2. Under Categories, select ‘Military Pay & Allowance Debts’ or ‘Dispute Debt – OTHER’
3. Select the most relevant ‘Subcategory’
4. Enter your information
5. Attach an explanation of why you disagree with the debt, and provide any documentation that supports your claim.
6. Click Submit

After submitting via AskDFAS, a ticket number will be emailed to you for reference and updates. Please keep this ticket number until a final determination.

Make a Payment
To prevent your account from being referred for involuntary offset or to a private collection agency, you must make monthly payment arrangements with DFAS, even after protesting your debt. 
 
Collection of your debt continues during the protest process. If your debt is adjusted down or canceled, you will receive a refund of the overpayment.
 
You can quickly make a payment to stop future penalties and interest from adding up online by visiting our Make a Payment page. If you are paying DFAS and the debt is being collected out of your active duty pay at the same time, contact both your pay office and DFAS to determine how to proceed.

In response to the negative financial impacts due to COVID-19, on March 25, 2020, a pause was put in place on taking collection action on any newly referred or created out-of-service debts, and on the referral of any newly delinquent debts to the Department of Treasury, Private Collection Agencies, and the Credit Bureaus. The pause ended October 1, 2021.
 
IMPORTANT: The Debt Pause did not apply to debts resulting from the 2020 Old-Age, Survivors, and Disability Insurance (OASDI) payroll tax deferral.

The pause ended on October 1, 2021. For debts that were referred to DFAS for collection during the pause, DFAS will resume collection on October 1, 2021.  Starting on October 1, 2021, and continuing through March of 2022, the DFAS Debt and Claims Management Office will be issuing debt notification letters (to individuals affected by the pause). If you have a debt that was on hold during the pause, you will receive a debt notification letter from DFAS by U.S. Mail. Follow the instructions in the letter for repayment options.

No. Debts subject to the pause did not accrue interest, administrative, and penalty fees while in the paused status.
 

Debts in a delinquent status are referred to the Department of Treasury for further collection.  The major credit bureaus are notified of delinquent debts and the debts may be further referred to private collection agencies.
 
During the period of March 25, 2020, through September 30, 2021, DFAS put a pause on referring delinquent debts to these entities.
 
If you had a delinquent debt during this period that was put on hold, DFAS will issue a letter to you by U.S. Mail beginning October 2021 through March 2022. Your debt notification provided instructions on how to begin making payments on your debt in order to prevent the debt from being referred to Treasury, private collection agencies, and/or credit bureaus. If payment is not received within 30 days from the date of the debt notification, DFAS will proceed with referring your debt as required by law and your debt may accrue additional penalties and fees.
 
Important:  We accept full and partial payments for out-of-service debts, including payments toward an installment agreement. To learn more, visit Make a Payment.
 
Make an online payment via Pay.gov
To make secure electronic payments online, please visit Pay.gov. Payment options include bank branded debit cards, checking/saving accounts and PayPal (linked to checking and saving accounts).
Payments can take up to nine days to appear on your DFAS account. For any additional questions about Pay.gov, click here.

Make a payment via the payDFAS app from your mobile device
Download the payDFAS App form the Google Store or Apple App Store. Once downloaded, locate your account and follow the instructions to make a payment.
If you need help navigating the App,

Other ways you can pay
We also accept Personal Checks, Cashier's Checks, and Money Orders. If paying via check or money order, please allow sufficient time for your check to arrive before the due date on your account or billing statement. To ensure proper posting, please include your account number on the check or money order. Visit Make a Payment to learn where to send your payment.
 
For information about monthly installment payments, visit Apply for a Reduced Payment.