All About Special Savings Accounts for Combat Zones

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An agent may make a deposit using a special power of attorney. The special power of attorney must reflect the action the agent is attempting (e.g. if starting a SDP allotment must give authority to start, stop or change allotments; if depositing cash, traveler’s check or money order must give authority to receive Treasury checks and/or make deposits). Agents may not deposit personal checks on behalf of a service member.

Accrual of Interest

Deposited funds will accrue interest at 10% per annum, compounded quarterly, based on calendar year. Interest only accrues on amounts up to $10,000 (principal and accrued interest combined). Deposits made on a cash collection voucher on or before 10th of the month accrue interest from the 1st of that month. Deposits made after the 10th of the month accrue interest from the first day of the following month. Deposit date is the date received by the servicing finance battalion regardless of date of entry into the financial system or submission to unit financial representative.

Eligibility for SDP stops on the day of departure; however, interest will continue to accrue up to 90 days after redeployment. If the service member requests withdrawal of funds prior to the 90th day, interest stops on date of request. (NOTE: If the 90th day falls on any day other than the last day of a month, interest will accrue through the last day of the preceding month.) Since the IRS considers SDP interest unearned income the interest is taxable even though the soldier is located in a combat zone tax exempt (CZTE) area.


Making Withdrawals

Deposits may be discontinued at any time. Generally, withdrawals may only be made upon termination of eligibility for the program. Withdrawals of this type must be for the entire sum of the deposit account. Defense Finance & Accounting Service (DFAS) will post the SDP balance of active component members to their Leave and Earnings Statement (LES). This balance may not be accurate due to timing constraints of posting cash collection vouchers. However, late processing does not affect interest as interest is based on date of deposit. When the amount is posted to the system the LES will reflect the full amount of the deposit plus any applicable interest, dating back to the deposit date.

If a service member’s account contains over $10,000 the service member may make quarterly requests to withdraw the balance that exceeds $10,000. The $10,000 remains in the account until the service member’s eligibility terminates and the service member withdraws the remaining funds in entirety. Service members may make emergency withdrawal requests of full or partial amounts before eligibility termination. Emergency requests must be for the health and welfare of a member or his dependent and must be substantiated by a written request from the member’s unit commander.

To receive funds, mail or fax a written request to the address below. Include the following: name, social security number, branch of service, component (e.g. active or reserve), start and stop date of tour in eligible area, and amount requested. Active duty members will automatically receive their payment via electronic funds transfer (EFT) to the same account as their normal monthly pay. Reservists and separated members requesting EFTs must include the bank account number, type of account (checking or savings), and the bank’s routing transit number or a voided check or deposit slip in their request. Reservists and separated members requesting payment via check must provide a current address.

DFAS- Cleveland Center (DFAS-CL)
1240 East 9th Street
Cleveland, OH 44199-2055

Questions regarding SDP withdrawal requests should be directed to:

Toll Free (stateside only) 1-888-332-7411
COMM (216) 522-5096,
DSN 580-5096, 7:00 AM to 6:30 PM (Eastern Time)

Above information courtesy of DOD and the Army's 13th Finance Group
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