No tax on troops’ $1,776 ‘warrior dividend,’ IRS says

The 1.5 million troops who received an unexpected $1,776 so-called “ warrior dividend” payment in December won’t have to pay taxes on that money, the Internal Revenue Service has confirmed. In a Dec. 17 speech, President Donald Trump announced the payments, which he described as a “warrior dividend,“ would be made to 1.5 million troops, and said they were funded by revenue from tariffs and $2.9 billion in the One Big Beautiful Bill Act enacted last July.

The Associated Press later reported that the payments weren’t being funded by tariffs. Active-duty service members in pay grades O-6 and below, and eligible Reserve Component members, received the payments, which were described by the Pentagon as “supplemental basic allowance for housing payments.” The IRS said in a release Friday that bas