When he read last fall that Congress had approved a new 40-year military pay table, Capt. Mark P. Larson, a Navy dentist with 36 years' service, tagged the report as "too good to be true."

Recently Larson learned it is true and significant. If he retires in May, when he reaches 37 years of service, the new pay table will boost his retired pay by almost $21,000 a year, from $81,321 to $102,300.

Suddenly, he says, other Navy dentists are asking how they might extend their careers past the traditional 30-year ceiling.

Bill Carr, deputy undersecretary of defense for military personnel policy, said the reshaped table "clearly invites longer careers" which complements "the department's personnel strategies."

He added that the new table also ensures "that those E-9s who asked to stay on for the war saw their pay rise, as they should."

Congress raised lifetime pay for longer-serving members in several ways when it passed the 2007 defense authorization act last fall.

Here are details as explained by officials.

Retired pay multiplier. Service members with longer than 30-year careers through last year saw retired pay capped at 75 percent of basic pay. That is, their retired pay multiplier of 2.5 percent of basic pay for each year served maxed out after 30 years.

Effective Jan. 1, members serving beyond 30 years see their 75 percent multiplier continue to grow at 2.5 percent a year. So Larson, if he retires at the 37-year mark, would receive retired pay equal to 92.5 percent of basic pay. It climbs to 100 percent if he stays for 40.

Forty-year pay table. On April 1, a 40-year pay table goes into effect. It adds new "longevity" steps for basic pay of officers in the ranks O-6 through O-10, warrant officers in grades 4 and 5, and enlisted E-8s and E-9s. All others continue to see longevity raises top out at 26 years.

For example, an E-9 who reaches 38 years will draw basic pay starting in April of $6,382 a month, $869 more than paid under the current table. A four-star officer (O-10) with 38 years will begin receiving $16,796 a month, $2,287 more than status quo.

Executive-level cap lifted. Through 2006, basic pay for generals and admirals could not exceed Executive Level III federal civilian pay. In 2006, that pay cap was $12,667 a month. It dampened retired pay too because the 75 percent multiplier was applied only to capped basic pay.

Congress raised that cap to Executive Level II on Jan. 1, which lifted monthly basic pay for senior officers to a maximum of $14,000.

But lawmakers did them another favor. It changed the law so the executive level pay cap is ignored when calculating flag officer retired pay.

The effect of all these changes is huge. A four-star officer who retires after April 1 will get an annuity equal to 100 percent, not 75 percent, of final basic pay. And basic pay will be much higher. An O-10 who retirees at 40 years April 1 will get 100 percent of $201,546 versus 75 percent of $151,999.