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Because It's The Law

J. D. Pendry

Conscience and law never go together. - William Congreve



Sec. 5305. Waiver of retired pay.

Any person who is receiving pay pursuant to any provision of law providing retired or retirement pay to persons in the Armed Forces, or as a commissioned officer of the National Oceanic and Atmospheric Administration or of the Public Health Service, and who would be eligible to receive pension or compensation under the laws administered by the Secretary if such person were not receiving such retired or retirement pay, shall be entitled to receive such pension or compensation upon the filing by such person with the department by which such retired or retirement pay is paid of a waiver of so much of such person's retired or retirement pay as is equal in amount to such pension or compensation. To prevent duplication of payments, the department with which any such waiver is filed shall notify the Secretary of the receipt of such waiver, the amount waived, and the effective date of the reduction in retired or retirement pay.


I started this BunkerTalk with Section 5305 from Title 38 of the United States Code, Veteran's Benefits. This discussion needs to be serious so I'll refrain from my usual attempts at humor and sarcasm. Read the law and understand it, especially if you are now retired, or plan someday to retire from the Armed Forces of the United States.

I often talk with veterans regarding their benefits and entitlements. One day I answered a call from an Army retiree - a veteran of 27 years. He served our country from 1940 to 1967 making him a WWII, Korean War, and Viet Nam era veteran. A conversation with a veteran of three of our nation's wars could easily have been the highlight of my day instead it turned out to be the low point of it.

After all these years, the old soldier applied for service-connected disability compensation and got a 10 percent disability rating. The rating pays him $101.00 per month compensation. In my short time with the VA I can tell you, without much reservation, that this seasoned trooper probably had more things wrong with him and could likely have claimed them years earlier, but for whatever reason he never did.

He called because he had just received an award letter from the VA. The letter explained to him that he would receive compensation of $101.00 per month, however, since he was retired from the military, the Defense Finance and Accounting Services would reduce his Army retirement check by the same amount.

He asked why his retirement pay was being reduced and I explained to him because the law requires it. He responded by saying that he earned his retirement pay - it was his - and asked again, why he had to give it up. I tried once more to explain to him that it's the law that causes that to happen. He told me that he didn't think that was a very fair law, wished me a good day and then he hung up the phone.

If he had honorable service but didn't retire, this law would not have affected him. Let me explain. Assume that he served an honorable tour in the service that didn't end in retirement. Following his service, he went to work for the federal civil service and retired from that job with a civil service retirement. The $101.00 per month disability compensation would have no affect on his civil service retirement pay. Nor, would any other retirement from any job you can think of except those mentioned in this law.

Other interesting things happen when this law is applied - and it's always applied. Veteran's claims often take a while to process. In some cases, it could be a year or more. It usually depends on the length of time it takes to acquire all the evidence necessary to decide the claim.

The date a veteran files his claim establishes his effective date of benefits if he's given compensation. If it takes a year to finish a claim, a 10 percent award means a retroactive or back payment of more than one thousand dollars. A retiree doesn't get a back payment. He gets a letter explaining how many months compensation were withheld because he receives military retired pay. His benefit is that he doesn't have to pay taxes on that amount when he files.

If a person files a claim within one year of the date he leaves the service his effective date, if granted compensation, is the day following his last day of service. For example, if he leaves service on the last day of the month his effective date is the first day of the next month.

Try this scenario. Assume that a veteran does not file his claim until the tenth month following his release from active duty. His effective date is still the day following the day of his release. Assume also, that it takes another ten months to finish his claim. If the veteran is granted compensation, he has twenty months of back pay coming. Let's make it more interesting. Assume he was granted 60 percent service connected disability compensation and has a spouse. If the veteran left the service before retiring, he would receive a retroactive payment for $16,280. That's a benefit of $841 per month for a 60 percent disabled veteran with a spouse. The military retiree on the other hand, gets a letter explaining to him that he is entitled to that monthly rate effective the same date, but it's withheld because he receives military retired pay.

This law also requires that severance and disability separation pay be recouped before disability benefits are paid - even if a veteran didn't retire.

It's a rare military retiree that does not have some physical disability, even if a slight one, after 20 years or more of service. While other veterans are compensated and rightly so, the retiree only realizes a tax break. The tax break never equals the amount he or she could receive if this law did not exist.

I'm going to finish this BunkerTalk by asking that you use your networks to ensure that all military personnel, retirees or future retirees are aware of this law so they can judge for themselves the fairness of it. I'm also going to leave you with some links that will let you do some research on your own and give you the opportunity to express your opinion to your elected representatives who can change it.

Title 38 of the United States Code
Senate Committee on Veteran's Affairs
Senator Specter - Chairman of the Senate Committee on Veterans' Affairs
Senator Rockefeller - Ranking Member of the Senate Committee on Veterans' Affairs
Write Your Representative - use this link to write your Congressman your opinion about this law.


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When the way comes to an end, then change - having changed, you pass through.

       I. Ching


Bruce "Doc". Melson