When you hear about a person being released from prison after serving only half of a their sentence, that person was not in the federal prison system. Often, state prisons are much more lenient on the actual sentence that must be served before an inmate can be released early to his or her family.
The same is not true in the federal prison system. Individuals convicted of a federal crime who must serve time in a federal prison can earn credit toward early release but it will likely not substantially reduce a sentence like it would in the North Carolina state prison system.
Federal law allows a credit of 54 days for every 365 days (or one year) of good behavior. To be eligible for early release, a person must be sentenced to more than one year in prison. You may have heard of sentences of a year and a day that may have sounded odd, but that extra day means that person could be eligible for the early release program, whereas someone sentenced only to a year would not be.
The maximum number of days that can be awarded for good conduct is 54. The Bureau of Prisons has discretion to award any number of days less than 54 based on its evaluation of the inmate's conduct.
Calculation of the Good Time Credit in federal prison is not simple by any means. A 10-year-sentence does not mean that an inmate can be released 540 days early for good behavior (54 days per year x 10 years). The credit is based on time actually served. So, if early release for good conduct is granted on a year-and-a-day sentence, the inmate could be out as soon as 46 days before the actual end of his her sentence. The full 54 days will not be granted unless a full year is served by the individual.
Those who are sentenced to life in federal prison are not eligible for early release based on the good conduct formula.
Source: Families Against Mandatory Minimums, "FAQs About Federal Good Time Credit" (pdf)