Va Check instead of Retirement Pay

skrockij89

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
Hello. I will be officially medically retired on November 28th and wanted to know what I need to do to ensure I'll receive my VA pension instead of my retirement paycheck. I was never told what I needed to do when out-processing. Do I need to contact the VA and DFAS? Please let me know if you have any advice to this topic. Thanks!
 

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
You would have to select VA compensation in lieu of retired pay on the VA claim for compensation (not "pension" in this case).

Part V - Military Retired/Severance Pay What If I have received or will receive military pay?

This section asks about your military severance or separation pay, the type, and the amount. If you currently receive military retired pay, we may reduce your retired pay by the amount of any compensation that we award. It is to your advantage because VA compensation is not taxable while retired pay is taxable. However, if you wish to receive military retired pay rather than VA compensation, you must check the box in Item 25. Some veterans receive various readjustment, separation, or severance pay from service departments which may be recouped in full or in part from VA benefit payments.

The above was taken from a 2014 version of VA Form 526, VETERAN'S APPLICATION FOR COMPENSATION AND/OR PENSION. There might be more recent versions.

Ron

Added: https://www.vba.va.gov/pubs/forms/VBA-21-526ez-ARE.pdf is a 2018 EZ version.
See Section VI:
IMPORTANT INFORMATION ON MILITARY RETIRED PAY (Includes all Uniformed Services Retired Pay): Submission of this application constitutes a waiver of military retired pay in an amount equal to VA compensation awarded, if you are entitled to both benefits. Your retired pay may be reduced by the amount of VA compensation awarded. Receipt of the full amount of military retired pay and VA compensation at the same time may result in an overpayment, which may be subject to collection. If you qualify for concurrent receipt of VA compensation and military retired pay, the waiver of retired pay will not apply. If you do not want to waive any retired pay to receive VA compensation, you should check the box in Item 26. Note that if you check the box in Item 26, you will not receive VA compensation, if granted. If you are currently in receipt of VA compensation and you check the box in Item 26, your VA compensation will be terminated, if you are also eligible for military retired pay. IMPORTANT: VA COMPENSATION PAY IS NON-TAXABLE. THEREFORE, VA COMPENSATION PAY MAY BE THE GREATER BENEFIT.
24A. ARE YOU RECEIVING MILITARY RETIRED PAY? (If "Yes," complete Items 24C and 24D) 24B. WILL YOU RECEIVE MILITARY RETIRED PAY IN THE FUTURE?
26. Do NOT pay me VA compensation. I do NOT want to receive VA compensation in lieu of retired pay [DO NOT CHECK THIS BLOCK...RG]
 
Last edited:

chaplaincharlie

Super Moderator
Staff Member
PEB Forum Veteran
Lifetime Supporter
Registered Member
DFAS will eventually send you a snail mail explaining that your VA check was more beneficial to you than your DoD retirement. This process happens automatically. When you applied for VA benefits you should have been asked to give your checking account number and routing number.

Once you have a DD214, upload it to your open VA claim. Since you were DoD in November you will not be eligible for VA pay until DEcember. The check for December will arrive in January, if you upload you DD214 pronto!
 

skrockij89

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
DFAS will eventually send you a snail mail explaining that your VA check was more beneficial to you than your DoD retirement. This process happens automatically. When you applied for VA benefits you should have been asked to give your checking account number and routing number.

Once you have a DD214, upload it to your open VA claim. Since you were DoD in November you will not be eligible for VA pay until DEcember. The check for December will arrive in January, if you upload you DD214 pronto!

Perfect! I'll make sure to upload it asap when I receive it. Thank you!
 

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
Re: “DFAS will eventually send you a snail mail explaining that your VA check was more beneficial to you than your DoD retirement. This process happens automatically. When you applied for VA benefits you should have been asked to give your checking account number and routing number.”

A minor addition. A letter is generated, but the DFAS will not automatically waive the retired pay and simultaneously the VA begin to pay VA compensation. I could be wrong, but I think the notice discussed here is from the VA rather than DFAS. Unless the retireee is eligible for CRDP, the waiver must be in place for receipt of VA comp. I have seen many cases where VA comp was withheld because of the erroneous selection on the VA claim form. The retirees in those cases had to submit another form to fix the matter.

Ron
 

chaplaincharlie

Super Moderator
Staff Member
PEB Forum Veteran
Lifetime Supporter
Registered Member
@RonG my letter came from DFAS, but I was CRDP eligible. Either way DFAS has to make a determination because those with less than 20 YOS can opt for military retirement and waive VA. There have been a few people on the forum who, for reasons I don't understand, have elected that option.

@skrockij89

filing the DD214 ASAP is a great idea. When it comes to finance issues I trust @RonG.
 

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
I put this together circa 2013-2014. The form versions have changed and those eligible are now automatically considered for CRDP unless a medical retirement is involved, but much of it remains pertinent. chaplaincharlie explained the CRDP sitiuation well.

I too cannot understand why a person would decline VA compensation since the retiree receives any residual retired pay after the VA offset. It is not a simple matter of which is higher as some have stated.

https://vetsbenefits.net/waiver-of-military-retirement-pay-forms-t111202.html

Ron
 
Last edited:

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
Ref: (VA Procedures) M21-1, Part III, Subpart v, Chapter 5, Section A - Elections and Waivers in Military Retired Pay (MRP) Cases

III.v.5.A.3.b.Notifying a Veteran Who Elected to Receive MRP of the Determinations VA Made on His/Her Claim
If VA denies a Veteran’s claim because he/she elected MRP instead of disability compensation, [the VA will] send a locally-generated letter to inform the Veteran of the

  • disabilities for which VA awarded SC
  • disabilities for which VA denied SC, and
    • rate payable, including scheduled future changes.
  • Reference: For more information on a claimant’s right to notification of
    VA decisions, see 38 CFR 3.103.

III.v.5.A.3.c. Furnishing VA Form 21-651 and Informing the Veteran of the Restriction on Concurrent Payments

In addition to taking the actions described in M21-1, Part III, Subpart v, 5.A.3.a, when notifying the Veteran of the determination made on his/her claim
  • furnish the Veteran with VA Form 21-651, per 38 U.S.C. 5304(a) and 5305, and
  • inform the Veteran that
    • VA must deny his/her claim until VA receives the enclosed VA Form 21-651, because there is a statutory restriction on concurrent payments of disability compensation and the full amount of MRP, and
    • if VA receives VA Form 21-651 within one year of the date of the decision notice, VA will grant entitlement to benefits from the effective date shown in the decision notice, as if VA had not denied the claim, with payments subject to withholding until the Veteran’s service department makes corresponding adjustments to his/her MRP. [MRP is Military Retired Pay]
I agree with Chaplaincharlie that DFAS will also send a notice to those eligible for CRDP...

Ron







 

Orange Sky

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
I’m waiting for anything in the mail from DFAS or the VA. I retired end of October and haven’t heard from either. I did call DFAS and was told to follow-up in 30-45 days, which would be end of December. The VA still hasn’t finalized either. I am concurrent receipt eligible so it may muddy the waters a little. Hoping for a little Christmas shopping funds :)
 

oddpedestrian

Super Moderator
Staff Member
PEB Forum Veteran
Lifetime Supporter
Registered Member
They don't know what they are doing my retirement is way higher than VA but I had claims come and go and every time the VA grants it they pay me back pay this is incorrect and will fail a system-wide audit. DFAS approves the change without telling the VA that they paid me residual retirement pay nothing I say or do changes it so one day maybe ten years in the future they probably going to say they overpaid me....
 

Orange Sky

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
I finally -and surprisingly- got my certified letter from DFAS regarding my military pay. I’m confused because the letter is showing 75% of my base pay but I see nothing about my VA pay amount. Method A is more advantageous (disability). My VA is in the $3500 range but my retired pay is also showing about the same. Between these two combined, I know I can’t make more than what I would have otherwise earned through a regular retirement. What an I missing?
I have yet to get my VA Award letter but since going through IDES, I have the proposal. I am CRDP but thinking once VA pension kicks in, my military retired pay will decrease?
 

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
You might be aware of the following:

1. You will have to waive/lose retired pay dollar for dollar in the amount of VA compensation received.
Example with 3501 retired pay and 3500 VA compensation: 3500 of 3501 retired pay is waived. Result: $1 retired pay and $3500 VA compensation.

2. If you also qualify for another retirement such as regular 20 year AD, and are rated by the VA >=50%, CRDP will restore retired pay not to exceed the dollar amount of the longevity portion of retired pay. CRDP does not restore the waived disability portion of retired pay.

Note: My CRSC statement shows a waiver of 3400 even though my retired pay “was” less than that. Also, the payment you receive from the VA is not a pension; it is non-taxable compensation. The VA does have a pension for low income veterans who served during periods of war.

Ron
 

Orange Sky

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
Thanks, Ron. My retiree pay letter shows 3700 monthly. My VA is expected to be 3500. So my total retiree pay from DFAS will bev$200?
 

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
Thanks, Ron. My retiree pay letter shows 3700 monthly. My VA is expected to be 3500. So my total retiree pay from DFAS will bev$200?
Very good. Yes...but if you are eligible for CRDP your amount from DFAS will be much more as described in my preceding paragraph.
Reserve retirees have to also meet the age requirement for retirement (and CRDP).

The CRDP plus the $200 residual retired pay cannot exceed the dollar amount of the longevity portion of retired pay.

Ron
 

Orange Sky

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
CRDP for both VA and DFAS should equate close to $6ooo/month? I’m 90 DoD, thus the 75% base pay calculation. I’m also over 20 active years so that’s the CRDP eligibility.
 
Last edited:

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
CRDP for both VA and DFAS should equate close to $6ooo/month?
1. CRDP is a “pay item” by DFAS and it is restored retired pay.
2. The VA sometimes uses the term CRDP when paying retro VA compensation. It is really VA compensation.
Note: The program is Concurrent Retirement and Disability Pay (CRDP)
3. One would have to compute the longevity portion of retired pay to confirm your figures. I can offer this: not all your waived retired pay will be restored by CRDP and the CRDP will be reduced by the amount of residual retired pay. It is somewhat complex.

4. Longevity portion of retired pay:
a. Years and partial years (e.g., 9 yrs and 3 mo = 9.25 years) of active duty x 2.5% = multiplier
b. High three average base pay x multiplier = longevity portion of your retired pay
c. The DFAS CRDP could not exceed the amount determined at 4b minus $200 (projected residual retired pay)

Ron
 
Last edited:

Orange Sky

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
Thanks Ron. It’ll get straightened out once I learn math and I start receiving my VA pay. Surprised retired pay hit first before VA based on what I’ve read from others.
 

RonG

Super Moderator
Staff Member
PEB Forum Veteran
Registered Member
Thanks Ron. It’ll get straightened out once I learn math and I start receiving my VA pay. Surprised retired pay hit first before VA based on what I’ve read from others.
Post your info once you receive VA comp and I will assist.

Needed:
—Active duty years or active duty years equivalent
—High three average base pay for retirement
—DoD percentage
—VA comp percentage; amount, and number of dependents by category
—SMCs and amounts (If applicable)
—Residual retired pay amount

Ron
 

skrockij89

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
Officially retired as of November 27th. I noticed on ebenefits, it's still showing Pending Decision Approval, along with an estimated completion date of 9/10/2018-11/13/2018. Think this is a bit weird but then again it's the VA. I went ahead and uploaded my DD-214 and filled out forms to establish care at the VA. Decided to schedule an appointment with a VSO to add the additional disabilities that weren't able to be added because the IDES already started.
 

Orange Sky

PEB Forum Regular Member
PEB Forum Veteran
Registered Member
We are still along the same timeframe. Funny. I received 12 emails back to back at one time so I’m hoping that’s the end or near it. Shows est completion date 12.21.2018-01-15 so will see. Good luck.
 
data-matched-content-ui-type="image_stacked" data-matched-content-rows-num="3" data-matched-content-columns-num="1" data-ad-format="autorelaxed">
Top