((a)) ** .—** Under regulations approved by the Secretary of Defense, the Secretary concerned may provide voluntary separation pay and benefits in accordance with this section to eligible members of the armed forces who are voluntarily separated from active duty in the armed forces.

((b)) ** .—**

((1)) Except as provided in paragraph (2), a member of the armed forces is eligible for voluntary separation pay and benefits under this section if the member—

((A)) has served on active duty for more than 6 years but not more than 20 years;

((B)) has served at least 5 years of continuous active duty immediately preceding the date of the member’s separation from active duty;

((C)) has not been approved for payment of a voluntary separation incentive under ;

((D)) meets such other requirements as the Secretary concerned may prescribe, which may include requirements relating to—

((i)) years of service, skill, rating, military specialty, or competitive category;

((ii)) grade or rank;

((iii)) remaining period of obligated service; or

((iv)) any combination of these factors; and

((E)) requests separation from active duty.

((2)) The following members are not eligible for voluntary separation pay and benefits under this section:

((A)) Members discharged with disability severance pay under .

((B)) Members transferred to the temporary disability retired list under section 1202 or 1205 of this title.

((C)) Members being evaluated for disability retirement under chapter 61 of this title.

((D)) Members who have been previously discharged with voluntary separation pay.

((E)) Members who are subject to pending disciplinary action or who are subject to administrative separation or mandatory discharge under any other provision of law or regulations.

((3)) The Secretary concerned shall determine each year the number of members to be separated, and provided separation pay and benefits, under this section during the fiscal year beginning in such year.

((c)) ** .—** Each eligible member of the armed forces whose request for separation from active duty under subsection (b)(1)(E) is approved shall be separated from active duty.

((d)) ** .—** Of the number of members of the armed forces to be separated from active duty in a fiscal year, as determined under subsection (b)(3), the Secretary concerned shall determine a number of such members, in such skill and grade combinations as the Secretary concerned shall designate, who shall serve in the Ready Reserve, after separation from active duty, for a period of not less than three years, as a condition of the receipt of voluntary separation pay and benefits under this section.

((e)) ** .—**

((1)) A member of the armed forces who is separated from active duty under subsection (c) shall be paid voluntary separation pay in accordance with subsection (g) in an amount determined by the Secretary concerned pursuant to subsection (f).

((2)) A member who is not entitled to retired or retainer pay upon separation shall be entitled to the benefits and services provided under—

((A)) chapter 58 of this title during the 180-day period beginning on the date the member is separated (notwithstanding any termination date for such benefits and services otherwise applicable under the provisions of such chapter); and

((B)) sections 452 and 453(c) of title 37.

((f)) ** .—** The Secretary concerned shall specify the amount of voluntary separation pay that an individual or defined group of members of the armed forces may be paid under subsection (e)(1). No member may receive as voluntary separation pay an amount greater than four times the full amount of separation pay for a member of the same pay grade and years of service who is involuntarily separated under .

((g)) ** .—**

((1)) Voluntary separation pay under this section may be paid in a single lump sum.

((2)) In the case of a member of the armed forces who, at the time of separation under subsection (c), has completed at least 15 years, but less than 20 years, of active service, voluntary separation pay may be paid, at the election of the Secretary concerned, in—

((A)) a single lump sum;

((B)) installments over a period not to exceed 10 years; or

((C)) a combination of lump sum and such installments.

((h)) ** .—**

((1)) A member who is paid voluntary separation pay under this section and who later qualifies for retired or retainer pay under this title or title 14 shall have deducted from each payment of such retired or retainer pay an amount, in such schedule of monthly installments as the Secretary concerned shall specify, until the total amount deducted from such retired or retainer pay is equal to the total amount of voluntary separation pay so paid.

((2))

((A)) Except as provided in subparagraphs (B) and (C), a member who is paid voluntary separation pay under this section shall not be deprived, by reason of the member’s receipt of such pay, of any disability compensation to which the member is entitled under the laws administered by the Secretary of Veterans Affairs, but there shall be deducted from such disability compensation an amount, in such schedule of monthly installments as the Secretary concerned shall specify, until the total amount deducted from such disability compensation is equal to the total amount of voluntary separation pay so paid, less the amount of Federal income tax withheld from such pay (such withholding being at the flat withholding rate for Federal income tax withholding, as in effect pursuant to regulations prescribed under chapter 24 of the Internal Revenue Code of 1986).

((B)) No deduction shall be made from the disability compensation paid to an eligible disabled uniformed services retiree under section 1413, or to an eligible combat-related disabled uniformed services retiree under , who is paid voluntary separation pay under this section.

((C)) No deduction may be made from the disability compensation paid to a member for the amount of voluntary separation pay received by the member because of an earlier discharge or release from a period of active duty if the disability which is the basis for that disability compensation was incurred or aggravated during a later period of active duty.

((3)) The requirement under this subsection to repay voluntary separation pay following retirement from the armed forces does not apply to a member who was eligible to retire at the time the member applied and was accepted for voluntary separation pay and benefits under this section.

((4)) The Secretary concerned may waive the requirement to repay voluntary separation pay under paragraphs (1) and (2) if the Secretary determines that recovery would be against equity and good conscience or would be contrary to the best interests of the United States.

((i)) ** .—** In this section, the term “retirement” includes a transfer to the Fleet Reserve or Fleet Marine Corps Reserve.

((j)) ** .—**

((1)) Except as provided in paragraphs (2), (3), and (4), a member of the armed forces who, after having received all or part of voluntary separation pay under this section, returns to active duty shall have deducted from each payment of basic pay, in such schedule of monthly installments as the Secretary concerned shall specify, until the total amount deducted from such basic pay equals the total amount of voluntary separation pay received.

((2)) Members who are involuntarily recalled to active duty or full-time National Guard duty in accordance with section 12301(a), 12301(b), 12301(g), 12302, 12303, 12304, 12304a, or 12304b of this title or shall not be subject to this subsection.

((3)) Members who are recalled or perform active duty or full-time National Guard duty in accordance with section 101(d)(1), 101(d)(2), 101(d)(5), 12301(d) (insofar as the period served is less than 180 consecutive days with the consent of the member), 12319, or 12503 of this title, or section 114, 115, or 502(f)(1)(B) of title 32 (insofar as the period served is less than 180 consecutive days with consent of the member), shall not be subject to this subsection.

((4)) This subsection shall not apply to a member who—

((A)) is involuntarily recalled to active duty or full-time National Guard duty; and

((B)) in the course of such duty, incurs a service-connected disability rated as total under .

((5)) The Secretary of Defense may waive, in whole or in part, repayment required under paragraph (1) if the Secretary determines that recovery would be against equity and good conscience or would be contrary to the best interests of the United States. The authority in this paragraph may be delegated only to the Undersecretary of Defense for Personnel and Readiness and the Principal Deputy Undersecretary of Defense for Personnel and Readiness.

((k)) ** .—**

((1)) The authority to separate a member of the armed forces from active duty under subsection (c) shall terminate on .

((2)) A member who separates by the date specified in paragraph (1) may continue to be provided voluntary separation pay and benefits under this section until the member has received the entire amount of pay and benefits to which the member is entitled under this section.