Double Bonus – Military Retirees Can Receive Retirement and VA Disability Benefits
When it comes to VA Disability Compensation, a veteran usually cannot receive VA disability payments in conjunction with any other kind of benefit related to the U.S. Department of Veterans Affairs or to the military. It’s either one or the other (or whichever is the higher benefit).
But can you collect VA disability and military retirement payments in special cases?
In short, yes. United States military retirees can receive both military retiree pay and VA disability compensation at the same time in any branch of service.
Two types of veterans benefits provide this concurrent receipt of pay: Concurrent Retirement and Disability Pay (CRDP) and Combat-Related Special Compensation (CRSC). The Defense Finance and Accounting Service (DFAS) manages these programs for the Department of Defense (DOD). This post is going to talk about CRDP, as previous posts have provided detailed explanations on CRSC payments.
How CRDP Came to Be
Until 2004, retired military members could not receive full military retired pay and VA compensation at the same time. They were obliged to waive one or the other. Because VA compensation is tax-free and often the greater benefit, veterans would choose this type of pay. Accordingly, the amount of military retirement pay would be reduced by the amount of their VA disability compensation (dollar to dollar). In cases in which the veteran was receiving VA compensation at the 100% level, the VA benefit often exceeded retirement pay.
However, there was much dispute over this prohibition of receiving dual benefits. Interested parties argued that this prohibition was discrimination against military retirees. As a result, the 2004 National Defense Authorization Act (NDAA) ruled that military retirees who had a 50% or higher disability rating could receive VA compensation and their full retirement benefit.
Note: CRDP is taxable and is considered countable income.
How Concurrent Retirement And Disability Pay (CRDP) Works
Under the NDAA, CRDP would slowly reimburse eligible retirees for the pay that they were obliged to waive in order to receive VA compensation. When the laws governing CRDP were issued in 2004, a 10-year phase in period was initiated. The phase in period was scheduled to end on December 31, 2013. Through this process, the retiree’s retired pay would gradually increase (by 10% each year) until the phase in was complete. A CRDP Computation Pay chart (can be viewed here) was used to determine how much retired pay a retiree would receive every year until the phase in was complete—at which point the retiree would receive the full monthly amount of retired pay.
As of January 2014 (at the completion of the phase in), military retirees no longer have to waive retired pay in order to receive VA compensation—provided that they are rated at a 50% or higher. However, retirees who have a rating lower than 50% must still elect either VA compensation or retired pay. Moreover, military retirees who had a VA disability rated at the 100% level (either combined or through Individual Unemployability) were not subject to the phase in and were automatically paid full retired pay and VA compensation.
In addition to the monthly payment benefit, recipients of CRDP may also be entitled to a retroactive payment. This amount is determined by:
- Date of retirement
- Date at which the retiree’s VA disability rating was increased to 50%
However, the retroactive date is limited to January 2004 as the earliest payable date.
Eligibility for CRDP
In order to receive CRDP, a veteran must eligible for retired pay and have a VA disability rating of 50% or more. Other eligibility requirements for this type of military pay include:
- Regular retiree with a VA disability rating of 50% or higher
- Reserve retiree with 20 qualifying years of service, who has a VA disability rating of 50 percent or greater and who has reached retirement age. (In most cases the retirement age for reservists is 60, but certain reserve retirees may be eligible before they turn 60.)
- Retired under Temporary Early Retirement Act (TERA) and have a VA disability rating of 50 percent or greater
- Disability retiree who earned entitlement to retired pay under any provision of law other than solely by disability, and you have a VA disability rating of 50 percent or greater
This benefit is awarded automatically to those who qualify. Therefore, there is no need to apply.
VA Ratings for CRDP
Any veteran who has been awarded service-connected disability can tell you that the VA is anything but simple when it comes to rating disabilities. The more disabilities you have, the more complicated it gets. And because a discussion on VA ratings could barely be contained in a single blog post, for the purposes of CRDP, we will only give the bare bones here.
The laws governing CRDP are concerned with a VA disability rating of 50% or higher. This rating may consist of:
- A single disability rated at 50% or higher
- Several disabilities rated at various percentages, the combination of which equals 50% or higher
- A combination of ratings below 100%, but being paid at the 100% rate under the rules of Total Disability due to Individual Unemployability (TDIU or IU)
Have Questions About Concurrent Retirement And Disability Pay?
It can be challenging for former military service members to obtain appropriate disability benefits, so throwing military retirement pay into the mix can be even more of a challenge. Fortunately, the legal team at Hill & Ponton is here to help. Focusing on social security and veterans disability law, we are committed to helping disabled veterans obtain accurate compensation benefits. If you are struggling to receive concurrent retirement and disability pay, contact our office today.
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