What is BAH?
The tax-free allowance that covers off-base housing, and how it shapes your PCS.
BAH (Basic Allowance for Housing) is a tax-free monthly allowance the U.S. military pays service members to cover off-base housing. The amount is set by pay grade, whether you have dependents, and the cost of housing at your duty station, so it rises in expensive areas and falls in cheaper ones.
Last updated: 2026-07-19
How BAH is calculated
Three factors set your rate:
- Pay grade — higher ranks receive more.
- Dependency status — the with-dependents rate is higher than the without-dependents rate.
- Duty station — each military housing area (MHA) has its own rates based on local rents.
The Defense Department resets rates every January using local rental market data. Because it is tied to location, your housing budget can change a lot from one assignment to the next. See the current rate on any of our base guides.
Why BAH matters when you PCS
When you PCS, your BAH changes to match the new duty station. Before you pick a neighborhood or decide to rent or buy, look up the rate for your rank at the new base. That number is your realistic monthly housing budget, and in low-cost areas it often covers a mortgage on a home bought with a VA loan.
BAH FAQ
Is BAH taxed?
No. Basic Allowance for Housing is a non-taxable allowance, so the full amount goes toward your housing costs. This is one reason a service member can often afford more house than a civilian earning the same total pay, because the housing portion is not reduced by federal or state income tax.
What happens to BAH if rent is cheaper than my allowance?
You keep the difference. BAH is paid at a flat rate for your pay grade, dependency status, and duty station, not based on your actual rent. If you find housing that costs less than your allowance, the extra is yours to keep. If your housing costs more, you cover the difference out of pocket.
Does BAH change when I PCS to a new base?
Yes. BAH is tied to the local housing market of your duty station, so it changes every time you move to a base in a different military housing area. High-cost areas like San Diego pay much more than low-cost areas, which is why the same rank can have very different housing budgets across duty stations.
See BAH by base
Look up housing costs, neighborhoods, and BAH for your next duty station.
Browse base guides