P 301806Z OCT 17
FM DFAS CLEVELAND OH
TO AIG 4676
AIG 4678
BT
UNCLAS
SUBJ/TAX WITHHOLDING FOR MEMBERS WITH A STATE OF LEGAL
RESIDENCE OF PUERTO RICO//
MILITARY PAY ADVISORY 32/17//
REF/A/DODFMR VOL 7A CHAPTER 44 2016 440202.B//
POC/CARMELITA LANIER/DFAS-JFLQ/CL/SYSTEMS LIAISON & PROCEDURES/
TEL: DSN 580-6888/TEL:  COMM: 216-522-6888//
NARR/REF A IS THE DODFMR VOL 7A, CHAPTER 44 PARA 440202.B
WHICH EXPLAINS THE TAX WITHHOLDING CHANGES.//
RMKS/1.  EFFECTIVE NOVEMBER 1 2017, MEMBERS CLAIMING THE STATE OF
LEGAL RESIDENCE OF PUERTO RICO WILL NOW HAVE TAXES WITHHELD FROM
THEIR MILITARY PAY.
2.  STARTING IN NOVEMBER 2017, THE PAY OF EFFECTED MEMBERS WILL
REFLECT CHANGES. THEIR 2017 IRS FORM W-2 WILL SHOW ANY FEDERAL
INCOME TAX WITHHOLDING (FITW) DEDUCTED PRIOR TO NOVEMBER.
3. THIS CHANGE COMPLIES WITH CURRENT INTERNAL REVENUE SERVICE (IRS)
REGULATIONS TO WITHHOLD ONLY STATE INCOME TAX WITHHOLDING (SITW) FOR
LEGAL RESIDENTS OF PUERTO RICO AND END DEDUCTIONS OF FEDERAL INCOME
TAX WITHHOLDING (FITW).
4.  MEMBERS SHOULD BE ADVISED TO REVIEW THEIR NOVEMBER LES TO
UNDERSTAND THE IMPACT OF THIS CHANGE ON THEIR PERSONAL FINANCES.
MEMBERS SHOULD ALSO SPEAK WITH THEIR COMMAND OR INSTALLATION FINANCE
COUNSELOR OR TAX ADVISOR REGARDING HOW THIS CHANGE WILL AFFECT THEIR
FEDERAL AND STATE TAX FILING REQUIREMENTS.
5.  REQUEST WIDEST DISSEMINATION.//