A bill to limit the amount that the Department of Defense may obligate during fiscal year 1986 for military basic pay and payments for currently accruing military retirement benefits, and for other purposes.

Limits the amounts available, from Department of Defense authorizations for military personnel accounts from FY 1986, for obligation for military basic pay and payments for accrued retired pay benefits within the Army, Navy, and Air Force.

Requires the Secretary of Defense to report to the Congress on proposed changes in the military nondisability retirement system. Requires certain accounting methods to be used in determining costs and savings from any legislative changes in the military retirement system during FY 1985 or 1986.