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Terminal Leave Calculator — Take It or Sell It Back?

By the Boots and Bearings team4 min read

Most people frame this as "cash now versus time off." That's the wrong frame. The two options don't pay the same rate. Sold-back leave pays your base pay only — no BAH, no BAS — and the lump sum is taxed. Terminal leave pays your full paycheck, allowances included, and you keep accruing leave the whole time you're on it.

Run your numbers

You'll accrue 15.0 more days

Zero if you live in barracks

Take it as terminal leave
$13,690
60.0 days × $228/day (pay + allowances)
Sell it back (before tax)
$9,170
60.0 days × $153/day (base pay only)

Terminal leave is worth $4,520 more here, before tax is even considered — and the sell-back figure gets taxed while terminal leave pay is taxed the same as any other paycheck.

Estimate only. Daily rates use the military convention of a 30-day month. Withholding varies, and terminal leave has to be approved by your command.

Why sell-back loses on the math

The gap is the allowances. If you draw BAH and BAS, they're a large share of your monthly compensation and sell-back ignores all of it. An E-6 drawing $1,800 BAH and $460 BAS is giving up roughly 33% of the daily value of each day sold. Sell-back is also paid as a lump sum with federal tax withheld, and state tax may apply depending on your state of legal residence.

The cap people forget

You can sell back a maximum of 60 days across your entire career— the statute counts every day already paid out since 1976 against that total. If you sold leave at a previous reenlistment or separation, it came out of the same 60. Terminal leave has no equivalent lifetime cap; it's limited by what you've accrued and what your command will approve.

When selling back is still the right call

  • A civilian job starts immediately. Double-dipping — drawing military pay on terminal leave while earning a civilian salary — is legal for most separating members, but check your service's rules and any conflict-of-interest restrictions, especially for federal or contractor roles tied to your current command.
  • Command won't approve the days. Operational requirements can make a long terminal leave impossible. Leave you can't take is leave you'll lose.
  • You're over the carryover ceiling. By statute you can't carry more than 60 days past the end of the fiscal year. Members on deployable assignments can be authorised to retain up to 30 days beyond that in writing by an O-6 or above, and it has to be used within two fiscal years. Everything else evaporates.

Do this before you decide

  • Pull your current balance from your LES — don't estimate it.
  • Ask your finance office whether you've sold leave before, and how much of the 60 remains.
  • Confirm your terminal leave dates with your command in writing, early. This is the step that fails.
  • Check what else expires around your separation date — TRICARE and SGLI both run on their own clocks. The transition timeline lays those out against your date.

Sources