CRDP Math Check

unbalancedscales

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Hey Guys,

I have gone through pretty much all the forums to make sure I have my head wrapped around CRDP. I just need some folks who are knowledgeable to check my math (I have many skills, but math is not one of them). Here are the brief relevant facts, as well as my calculation:

21+ years of service. 80% medical from Army; 100% from the VA. High 3 is $7,635, so $5,726 calculated at the 75% max from DFAS. No children or spouse, so VA is $2973. Based upon these numbers, as well as the computations, this is what I have come up with:

Step 1: Length of Service x 2.5 = .527 CRDP Max Percentage
Step 2: .527 x 7635 = 4023 (max CRDP)
Step 3: 5726 (DoD Retired Pay) – 2973 (VA Compensation) = 2753 (Net DoD Retired Pay)
Step 4: 4023 is more than 2973, so my DoD retired pay lost to offset is restored
Step 5: 2753 (retired net pay) + 2973 (CRDP) (CRDP is lower than the max amount because it only restores money lost to VA offset) = 5726 (paid by DFAS)
Step 6: 5726 (DFAS) + 2973 (VA) = 8699

Any assistance you can provide would be greatly appreciated. And thanks to @RonG for the computations and advice you put on here relevant to this.
 

RonG

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CRDP situation (unbalancedscales' computation):

21+ years of service. 80% medical from Army; 100% from the VA. High 3 is $7,635, so $5,726 calculated at the 75% max from DFAS. No children or spouse, so VA is $2973. Based upon these numbers, as well as the computations, this is what I have come up with:

Step 1: Length of Service x 2.5 = .527 CRDP Max Percentage
Step 2: .527 x 7635 = 4023 (max CRDP)
Step 3: 5726 (DoD Retired Pay) – 2973 (VA Compensation) = 2753 (Net DoD Retired Pay)
Step 4: 4023 is more than 2973, so my DoD retired pay lost to offset is restored
Step 5: 2753 (retired net pay) + 2973 (CRDP) (CRDP is lower than the max amount because it only restores money lost to VA offset) = 5726 (paid by DFAS)
Step 6: 5726 (DFAS) + 2973 (VA) = 8699

Comments:
1. I infer you qualified for a regular retirement via 21+ years AD.
2. Ref: DoD 7000.14-R Financial Management Regulation Volume 7B, Chapter 64 * October 2016
--640401. Special Rule for Disability Retirement

Members retired for disability under 10 U.S.C., Chapter 61 §§ 1201 through 1222 remain subject to the offset required under 38 U.S.C. §§ 5304 and 5305 for any retired pay they receive that is in excess of the amount of retired pay to which they would be entitled under any other provision of law based on service in the Uniformed Services, had they not retired for disability. Since retired pay in excess of the amount calculated for years in service is still subject to offset under the CRDP program, a member with an amount of retired pay remaining after offset of VA disability compensation, that is greater than the amount calculated for years of service, is not eligible for any increase in payment of retired pay under the CRDP program.

3. CRDP is retired pay, restored (CRSC, conversely, is special compensation that replaces waived retired pay).

4. Your retired pay is 5726. 5276 minus 4023 (longevity portion of retired pay) = 1253 DoD disability portion of retired pay.

5. I did not check your figures, just the concept and it appears correct. However, I have not seen many CH 61 retirees with >=20 years AD and would like to revisit this in the morning before I go to a medical appointment. The verbiage at the reference is what I wish to review later. The $1253 DoD disability portion of retired pay might be an additional consideration.

Ron
 

unbalancedscales

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CRDP situation (unbalancedscales' computation):

21+ years of service. 80% medical from Army; 100% from the VA. High 3 is $7,635, so $5,726 calculated at the 75% max from DFAS. No children or spouse, so VA is $2973. Based upon these numbers, as well as the computations, this is what I have come up with:

Step 1: Length of Service x 2.5 = .527 CRDP Max Percentage
Step 2: .527 x 7635 = 4023 (max CRDP)
Step 3: 5726 (DoD Retired Pay) – 2973 (VA Compensation) = 2753 (Net DoD Retired Pay)
Step 4: 4023 is more than 2973, so my DoD retired pay lost to offset is restored
Step 5: 2753 (retired net pay) + 2973 (CRDP) (CRDP is lower than the max amount because it only restores money lost to VA offset) = 5726 (paid by DFAS)
Step 6: 5726 (DFAS) + 2973 (VA) = 8699

Comments:
1. I infer you qualified for a regular retirement via 21+ years AD.
2. Ref: DoD 7000.14-R Financial Management Regulation Volume 7B, Chapter 64 * October 2016
--640401. Special Rule for Disability Retirement

Members retired for disability under 10 U.S.C., Chapter 61 §§ 1201 through 1222 remain subject to the offset required under 38 U.S.C. §§ 5304 and 5305 for any retired pay they receive that is in excess of the amount of retired pay to which they would be entitled under any other provision of law based on service in the Uniformed Services, had they not retired for disability. Since retired pay in excess of the amount calculated for years in service is still subject to offset under the CRDP program, a member with an amount of retired pay remaining after offset of VA disability compensation, that is greater than the amount calculated for years of service, is not eligible for any increase in payment of retired pay under the CRDP program.

3. CRDP is retired pay, restored (CRSC, conversely, is special compensation that replaces waived retired pay).

4. Your retired pay is 5726. 5276 minus 4023 (longevity portion of retired pay) = 1253 DoD disability portion of retired pay.

5. I did not check your figures, just the concept and it appears correct. However, I have not seen many CH 61 retirees with >=20 years AD and would like to revisit this in the morning before I go to a medical appointment. The verbiage at the reference is what I wish to review later. The $1253 DoD disability portion of retired pay might be an additional consideration.

Ron
Roger. Thanks Ron. I appreciate your help.
 

RonG

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This is pertinent:

38 CFR 3.750 - Entitlement to concurrent receipt of military retired pay and disability compensation.



§ 3.750 Entitlement to concurrent receipt of military retired pay and disability compensation.
(a)Definition of military retired pay. For the purposes of this part, military retired pay is payment received by a veteran that is classified as retired pay by the Service Department, including retainer pay, based on the recipient's service as a member of the Armed Forces or as a commissioned officer of the Public Health Service, the Coast and Geodetic Survey, the Environmental Science Services Administration, or the National Oceanic and Atmospheric Administration.

(b)Payment of both military retired pay and disability compensation or improved pension -

(1)Compensation. Subject to paragraphs (b)(2) and (b)(3) of this section, a veteran who is entitled to military retired pay and disability compensation for a service-connected disability rated 50 percent or more, or a combination of service-connected disabilities rated 50 percent or more, under the schedule for rating disabilities ( 38 CFR part 4, subpart B), is entitled to receive both payments subject to the phase-in period described in paragraph (c) of this section.

(2)Chapter 61 disability retirees retiring with 20 or more years of service. Disability retired pay payable under 10 U.S.C. Chapter 61 to a veteran with 20 or more years of creditable service may be paid concurrently with disability compensation to a qualifying veteran subject to the following:

(i) Any waiver required during the phase-in period under paragraph (c)(1)(ii) of this section; and

---->> (ii) If the veteran's disability retired pay exceeds the amount of retired pay the veteran would have received had the veteran retired based on length of service, the veteran must waive that excess amount of disability retired pay in order to receive VA disability compensation.


(3)Chapter 61 disability retirees retiring with less than 20 years of service. Veterans who receive disability retired pay under 10 U.S.C. Chapter 61 with less than 20 years of creditable service are not eligible for concurrent receipt.

----
Ron
 

RonG

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Unbalancedscales,

Re: CRDP for CH 61 retiree who also qualified for regular retirement due to 20+ years active duty

The following are selected portions of our other conversations via message:

Consideration:

“ (ii) If the veteran's disability retired pay exceeds the amount of retired pay the veteran would have received had the veteran retired based on length of service, the veteran must waive that excess amount of disability retired pay in order to receive VA disability compensation.”


Note: As a regular retiree who has received CRDP and CRSC at different times (@100%), my total from DFAS never exceeded my longevity retirement. That coupled with the fact one cannot receive two disability payments (DoD and VA) at the same time seems to support my assessment above.

$4023 is the longevity portion of retirement and a ceiling for the DFAS to pay when CRDP is involved. $1253 is the disability portion of the retirement. I suspect the breakdown would be: 4023 from DFAS (2973 CRDP + 1050 residual ret oay) Note: 1253 was DoD disability portion of retired pay.

Summary:
—longevity portion of retired pay 4023
—waiver of retired pay 2973 = CRDP of 2973
—4023 minus 2973 = 1050 residual Retired Pay that is for longevity
—amount payable by DFAS 2973 + 1050 = 4023 each month
—amount payable by VA = 2973 each month

As we discussed, please return to report how DFAS handles your particular situation. It will be helpful for others.

Ron
 
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RonG

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Update 22 Sep 18:

Feedback from retiree with minor editing for public post:

I received my Retiree Account Statement from DFAS today, and here are the relevant facts:

1. DFAS Payment: My gross pay is reflected as $5,726 on the DFAS statement, with a VA waiver amount of $1703, for a NET DFAS payment of $4023 (the max you stated DFAS would pay me above).

2. CRDP Payment Amount: My CDRP was calculated at $1,376.47. This is higher than your figure of $1,270 above because I forgot I am also entitled to receive Special Monthly Compensation (SMC) at the K-1 rate of $105.61. If I subtract SMC from the CDRP ($1,376.47-$105.61), I end up with $1,270.86 , which is essentially the CRDP you quoted above. [note: 4023 max payment less 1376.47 CRDP = 2646.53 residual retired pay...Ron]

3. My next assumption, based on the fact that DFAS is paying me $4023, the other $3079.47 comes as a separate payment from the VA? [yes...Ron]

-----
A new summary--Ron:
a. Gross retired pay = 5726
b. VA compensation = 3079.47
c. A minus B = 2646.53 residual retired pay
d. Dollar amount of longevity portion of retirement = 4023
e. D minus C = 1376.47 CRDP
f. Result: DFAS pays 4023 (2646.53 residual ret pay + 1376.47 CRDP) VA pays 3079.47 TOTAL: 7102.47
Note: SMC-K was absent from initial computations

Thank you unbalanced scales. This is the first report I have seen of a DFAS RAS for a CH 61 retiree who also qualified for regular retirement via 20 years active duty. I think this will prove helpful in the future for others in this category.

---
Ron
 
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Brokepilot

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Ron can you help me with this. I don't think mine is as difficult but I am confused. DOD 10% / VA 90%. High 3 is $6,633. Length of service percent is .577. Married two children.
Is mine just straight LOS % times 6,600 + 90% VA $2,280?
 

RonG

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Ron can you help me with this. I don't think mine is as difficult but I am confused. DOD 10% / VA 90%. High 3 is $6,633. Length of service percent is .577. Married two children.
Is mine just straight LOS % times 6,600 + 90% VA $2,280?
What type retirement did you receive (regular, disability, reserve)? Note: 30% or more reqired for DOD disability retirement.

How many years AD did you have?

IF, you received a regular retirement (20 yr AD), your CRDP will be the same amount as the VA compensation (not to exceed gross amount of retired pay) provided you are rated >=50% by VA. You would receive all your retired pay + VA compensation.

CRDP is Retired Pay...restored and shown on page two of the DFAS RAS as a remark.

The person who started this thread , has a medical retirement which involves a different computation.

Ron
 
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Brokepilot

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I'm in an MEB and have 23 years of active service. PEB found me unfit with a 10% rating. My understanding is I will retire CH 61 regardless of the rating percentage since I am over 20 years.
 
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RonG

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I'm in an MEB and have 23 years of active service. PEB found me unfit with a 10% rating. My understanding is I will retire CH 61 regardless of the rating percentage since I am over 20 years.
I see...thank you.

You will receive payment from DFAS not to exceed the dollar amount of the longevity portion of your retirement. That DFAS payment might include residual retired pay as well as CRDP (retired pay itself).

I have a commitment for which I must now leave but can provide an answer before 0600 hrs in the morning.

Ron
 

RonG

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Change of plans.

1. 23 yrs AD @2.5% ea = 57.5%
2. 6633 H3 x 0.575 = 3814 (rounded) ret pay and longevity portion as well
3. 2280 VA comp
4. 3814 - 2280 = 1534 residual Retired Pay
5. DFAS RAS will show 3814 gross retirement pay. Page two will contain a remark that 2280 is CRDP
6. Each month: 3814 DFAS (1534+2280) + 2280 VA Comp = 6094 using rounded figures

Ron
 

Brokepilot

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Thanks Ron! One last question. Can you break down what portion (or all) is taxed federally and FICA? Your help is greatly appreciated.
 

RonG

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Thanks Ron! One last question. Can you break down what portion (or all) is taxed federally and FICA? Your help is greatly appreciated.
Both retired pay and CRDP (also ret pay) are taxed by federal govt and some states.

Exception (which appears to not apply here):

Per Army source:
Disability retired and severance pay awarded to Soldiers who were not members of the Armed Forces on September 24, 1975, is considered taxable by the Internal Revenue Service. An exception exists for a Soldier receiving separation or retired pay by reason of a combat-related injury. The Physical Evaluation Board (PEB) will make combat-related determinations on all cases considered.

FICA does not apply to anything discussed in this thread.

VA comp is non-taxable.

Good luck,
Ron
 

slarrieux213

New Member
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Received 199 - oct 5
20 years on 10 Dec
I don’t want to lose my 20 years ... won’t know my retirement date or receive retirement order until I sign 199

What to do??
 

RonG

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Received 199 - oct 5
20 years on 10 Dec
I don’t want to lose my 20 years ... won’t know my retirement date or receive retirement order until I sign 199

What to do??
I am not in charge of anything, but your question might receive more replies if it was posted in your own thread (i.e., start new one).

This thread is primarily about CRDP computations and other DFAS related issues.

Good luck,
Ron
 
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