Trump’s Troop Bonus Checks to Be Paid for Under GOP Tax Law (1)

The $1,776 surprise bonuses for US troops that President Donald Trump announced Wednesday will come out of a $2.9 billion pot meant to supplement the military’s housing allowance in the GOP tax-and-spending law, according to aides granted anonymity to discuss the initiative.

The Trump administration informed lawmakers that the money would come out of the housing supplemental section of the reconciliation bill that provided the Pentagon with about $150 billion.

Trump announced the plans Wednesday during a prime-time address from the White House, which he used to extol his accomplishments from his first year back in the White House and convince voters they should still blame his predecessor for persistent economic anxieties.

Trump’s biggest announcement was a move to award service members $1,776 payments, a decision that should provide a holiday boost to about 1.45 million Americans.

The White House on Thursday confirmed that Defense Secretary Pete Hegseth directed the Pentagon to disburse $2.6 billion as a one-time basic housing supplement to all eligible service members. Troops are eligible from the rank of colonel on down (O-6 and below), according to the Pentagon. Reservists who have been on active duty for 31 days are also eligible.

Hegseth said Thursday the checks are “tax-free.” Assistance for military housing and other benefits are generally exempt from income taxes that are otherwise taken out of troops’ paycheck, thanks in part to a century-old legal precedent.

Most congressional Republicans, including Senate Armed Services Committee Chair Roger Wicker (R-Miss.), on Thursday praised the move as beneficial to a worthy population.

“How they decide to use that is probably somewhat a function of their discretion, but there was certainly money in there designed to benefit the troops,” said Senate Majority Leader John Thune (R-S.D.).

But the administration’s redirection of money earmarked for military housing is “problematic” absent plans to “plus up” those funds, said Sen. Thom Tillis (R-N.C.), a tax writer who voted against the originating law’s passage.

“We need to be intellectually consistent” when presidents eschew congressional intent, Tillis said. “I’m probably in the minority, though.”