President Donald Trump will use money originally set aside for military housing to fund $1,776 bonus payments for service members, according to a senior administration official.
In a prime-time address Wednesday night, Trump announced the payments — which he called a “warrior dividend” — saying they would arrive before Christmas and were meant to honor the nation’s founding in 1776.
Under the plan, the Trump administration will repurpose $2.6 billion in military housing assistance to issue one-time checks of $1,776 to more than a million troops. A senior administration official confirmed the funds come from Congressionally approved reconciliation money intended to help subsidize the Basic Allowance for Housing (BAH).
During his televised speech, Trump said he was “proud to announce” that about 1,450,000 service members would receive the bonus. “We are sending every soldier $1,776,” he said. “And the checks are already on the way.”
The senior official said Defense Secretary Pete Hegseth directed the Pentagon to distribute the funds as a one-time BAH supplement for eligible service members ranked O-6 and below. Congress had appropriated $2.9 billion for housing-related support as part of the “One Big Beautiful Bill” reconciliation package.
According to the administration, approximately 1.28 million active-duty troops and about 174,000 reserve members will receive the payment. To qualify, service members must be on active duty — including reserve members on orders of 31 days or more — as of Nov. 30, 2025, and be ranked O-6 or below.
The decision comes amid ongoing concerns about housing affordability for service members. BAH is meant to help cover off-base costs such as rent, mortgages, and utilities, but some troops have struggled as housing markets have shifted rapidly. A January 27 RAND report on Army personnel found that while BAH is generally adequate, a notable minority of service members report dissatisfaction, especially during periods of fast-changing housing costs.
“BAH is generally adequate for Army personnel,” the report said, “though not necessarily when the housing market is changing rapidly and dramatically.”
The administration defended the move, saying the bonus puts money directly into the hands of service members and their families. “This one-time Warrior Dividend helps improve their housing and quality of life,” the senior official said.
Lawmakers, however, have raised concerns about how defense funds are being used. During confirmation hearings, Senate Armed Services Committee Chairman Sen. Roger Wicker, R-Miss., has pressed Pentagon officials to commit to following Congress’s spending guidance for the more than $150 billion allocated for defense in the reconciliation bill.
Sen. Jack Reed, D-R.I., the committee’s ranking member, has expressed skepticism, saying the Pentagon may pursue its own priorities even if Congress disagrees.
Some lawmakers are already scrutinizing the administration’s broader reallocation of military funds. Last week, Sen. Elizabeth Warren, D-Mass., and Rep. John Garamendi, D-Calif., released a report highlighting $2 billion shifted away from the Defense and Homeland Security departments for border enforcement, including money originally meant for barracks, maintenance hangars, and elementary schools.
Meanwhile, the Defense Department announced last week that BAH rates for 2026 will increase by an average of 4.2 percent starting Jan. 1, 2026.
