‘‘(b) ELIGIBLE
INDIVIDUALS.—An individual re-
ferred to in subsection (a) is any member of the Armed 
Forces who, at the time of the approval by the Secretary 
concerned of the member’s request to transfer entitlement 
to basic educational assistance under this section— 
‘‘(1) has completed six years of service in the 
Selected Reserve; and 
‘‘(2) enters into an agreement to remain a 
member of the Selected Reserve for a period of not 
less than four years. 
‘‘(c) ELIGIBLE DEPENDENTS.—An individual may 
transfer entitlement under this section as follows: 
‘‘(1) To the individual’s spouse. 
‘‘(2) To one or more of the individual’s chil-
dren. 
‘‘(3) To a combination of the individuals re-
ferred to in paragraphs (1) and (2). 
‘‘(d) DESIGNATION OF TRANSFEREE.—An individual 
transferring entitlement under this section shall— 
‘‘(1) designate the dependent or dependents to 
whom such entitlement is being transferred; 
‘‘(2) designate the number of months of such 
entitlement to be transferred to each such depend-
ent; and
‘‘(3) specify the period for which the transfer 
shall be effective for each such dependent. 
‘‘(e) REVOCATION
AND MODIFICATION.—An indi-
vidual transferring entitlement under this section may 
modify or revoke at any time the transfer of any unused 
portion of the entitlement so transferred. The modification 
or revocation of the transfer of entitlement under this sub-
section shall be made by the submittal of written notice 
of the action to both the Secretary concerned and the Sec-
retary of Veterans Affairs. 
‘‘(f) COMMENCEMENT OF USE.—If the dependent to 
whom entitlement is transferred under this section is a 
child, the use of the transferred entitlement may not com-
mence until the child— 
‘‘(1) completes the requirements of a secondary 
school diploma (or equivalency certificate); or 
‘‘(2) attains 18 years of age. 
‘‘(g) TIME LIMITATION FOR USE OF ELIGIBILITY 
AND ENTITLEMENT.—Notwithstanding section 16133 of 
this title, and subject to subsection (d)(3), a dependent 
to whom entitlement is transferred under this section may 
use such entitlement until the later of— 
‘‘(1) the expiration date of a 15-year period be-
ginning on the commencement date of the period 
prescribed by section 16133(a)(1) that is applicable
to the individual who transferred such entitlement to 
the dependent; or 
‘‘(2) the date that is 10 years after the date the 
individual who transferred such entitlement to the 
dependent is separated from the Selected Reserve, 
whichever occurs first. 
‘‘(h) ADDITIONAL ADMINISTRATIVE MATTERS.—(1) 
The use of any entitlement transferred under this section 
shall be charged against the entitlement of the individual 
making the transfer at the rate of one month for each 
month of transferred entitlement that is used. 
‘‘(2) Except as provided under paragraphs (2) and 
(3) of subsection (d) and subsection (g), and subject to 
paragraph (5), a dependent to whom entitlement is trans-
ferred under this section is entitled to educational assist-
ance under this chapter in the same manner as the indi-
vidual from whom entitlement was transferred. 
‘‘(3) The monthly rate of educational assistance pay-
able to a dependent to whom entitlement is transferred 
under this section shall be the monthly amount payable 
under section 16131 of this title to the individual making 
the transfer. 
‘‘(4) The death of an individual transferring entitle-
ment under this section shall not affect the use of the
transferred entitlement by the dependent to whom entitle-
ment is transferred. 
‘‘(5) Notwithstanding subsection (g) and section 
16133 of this title, a child to whom entitlement is trans-
ferred under this section may not use any entitlement so 
transferred after attaining the age of 26 years. 
‘‘(6) Except as provided in subsection (f), the pur-
poses for which a dependent to whom entitlement is trans-
ferred under this section may use such entitlement shall 
include the pursuit and completion of the requirements of 
a secondary school diploma (or equivalency certificate). 
‘‘(i) OVERPAYMENT.—In the event of an overpayment 
of basic educational assistance with respect to a dependent 
to whom entitlement is transferred under this section, the 
dependent and the individual making the transfer shall be 
jointly and severally liable to the United States for the 
amount of the overpayment for purposes of section 3685 
of title 38. 
‘‘(j) REGULATIONS.—The Secretaries concerned shall 
prescribe regulations for purposes of this section. 
‘‘(k) SECRETARY CONCERNED DEFINED.—Notwith-
standing section 101(a)(9), in this section the term ‘Sec-
retary concerned’ means— 
‘‘(1) the Secretary of the Army with respect to 
matters concerning the Army;
‘‘(2) the Secretary of the Navy with respect to 
matters concerning the Navy or the Marine Corps; 
‘‘(3) the Secretary of the Air Force with respect 
to matters concerning the Air Force; and 
‘‘(4) the Secretary of Defense with respect to 
matters concerning the Coast Guard, or the Sec-
retary of Homeland Security when it is not oper-
ating as a service in the Navy.’’. 
(2) The table of sections at the beginning of such 
chapter is amended by adding at the end the following 
new item: 
‘‘16138. Transfer of entitlement to educational assistance.’’. 
(b) 
CONFORMING
AMENDMENTS.—(1) 
Section 
16133(a) of such title is amended by inserting ‘‘and sec-
tion 16138’’ after ‘‘subsection (b)’’. 
(2) Section 16137 of such title is amended by insert-
ing ‘‘Each such report shall also include the number of 
members of the Selected Reserve of the Ready Reserve of 
each armed force transferring entitlement to educational 
assistance under section 16138.’’ after ‘‘those fiscal 
years.’’. 
SEC. 202. CREDIT FOR CUMULATIVE ACTIVE DUTY SERVICE 
IN THE SELECTED RESERVE. 
(a) ENTITLEMENT.—Section 3012(a)(1) of title 38, 
United States Code, is amended—