Concurrent Retirement and Disability Pay (CRDP)
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Concurrent Retirement and Disability Pay (CRDP) Combat Related Special Compensation (CRSC) Objectives At the end of this session, you will be able to answer the following questions: What are CRSC and CRDP? Who is eligible for each program?
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01
Concurrent Retirement and Disability Pay (CRDP)
Combat Related Special Compensation (CRSC)<br>
Combat Related Special Compensation (CRSC)<br>
02
Objectives At the end of this session, you will be able to answer the following questions:
What are CRSC and CRDP?
Who is eligible for each program?
How do veterans qualify for these programs?
How does VA/DoD determine how much a veteran receives? 2<br>
What are CRSC and CRDP?
Who is eligible for each program?
How do veterans qualify for these programs?
How does VA/DoD determine how much a veteran receives? 2<br>
03
Why Discuss CRSC & CRDP? While not chartered to file CRSC or CRDP applications, accredited representatives are a veteran’s lifeline on all things related to life after service. 3<br>
04
Prohibition on Concurrent Receipt and the VA Waiver Submission of an application for VA compensation constitutes a waiver of retired pay, unless the veteran checks the box on the 21-526ez negating the waiver. If a uniformed service retiree checks the box negating the waiver, VA may not pay compensation.
If a veteran has waived retired pay as described above, VA will withhold retroactive VA compensation (limited to gross retired pay) and the Veteran’s retired pay center (RPC) will withhold the amount of VA compensation being paid from current retired pay.
This is where CRSC and CRDP come into the picture 4<br>
If a veteran has waived retired pay as described above, VA will withhold retroactive VA compensation (limited to gross retired pay) and the Veteran’s retired pay center (RPC) will withhold the amount of VA compensation being paid from current retired pay.
This is where CRSC and CRDP come into the picture 4<br>
05
What are CRSC and CRDP? CRDP and CRSC are Military Retiree benefits administered by the Department of Defense and Services
They are not administered by VA
VA’s function is to check with DFAS (Defense Finance and Accounting Services) to ensure there is no overpayment
CRDP and CRSC restore ONLY “vested service” retired pay based on longevity and still prohibits double payment of disability pay 5<br>
They are not administered by VA
VA’s function is to check with DFAS (Defense Finance and Accounting Services) to ensure there is no overpayment
CRDP and CRSC restore ONLY “vested service” retired pay based on longevity and still prohibits double payment of disability pay 5<br>
06
What are CRSC and CRDP? Veterans can choose either CRDP or CRSC not both
You can change your selection once a year at “open season” 6<br>
You can change your selection once a year at “open season” 6<br>
07
Combat-Related Special Compensation (CRSC) CRSC is a special monthly benefit paid to Veterans who retired from the uniformed services and have VA service-connected disabilities deemed combat-related by their branch of service.
CRSC restores, partially or completely, retired pay that is being lost due to the VA waiver.
CRSC is paid by the Defense Finance and Accounting Service (DFAS) and the U.S. Coast Guard (USGC); however, sometimes VA must reduce retroactive retired pay withholdings for a Veteran to receive his/her full CRSC entitlement. 7<br>
CRSC restores, partially or completely, retired pay that is being lost due to the VA waiver.
CRSC is paid by the Defense Finance and Accounting Service (DFAS) and the U.S. Coast Guard (USGC); however, sometimes VA must reduce retroactive retired pay withholdings for a Veteran to receive his/her full CRSC entitlement. 7<br>
08
Combat-Related Special Compensation (CRSC) Eligibility NOT a VA program
Veterans must apply through their military service branch
Must be entitled to and/or receiving military retired pay
For Reservists, at least 60 years old OR retired under Temporary Early Retirement Authority OR medically retired
Must have VA waiver
Tax free
Must be receiving VA compensation for combat-related injury/condition or disability directly related to a Purple Heart (10% or more)
Includes additional allowance for dependents 8<br>
Veterans must apply through their military service branch
Must be entitled to and/or receiving military retired pay
For Reservists, at least 60 years old OR retired under Temporary Early Retirement Authority OR medically retired
Must have VA waiver
Tax free
Must be receiving VA compensation for combat-related injury/condition or disability directly related to a Purple Heart (10% or more)
Includes additional allowance for dependents 8<br>
09
CRSC: What is combat related? Injuries incurred as direct result of:
Armed conflict
Hazardous duty
Instrumentality of war
Simulated war
Agent Orange exposure disabilities count
Other exposure disabilities as a result of instrumentality of war (radiation, mustard gas, lewisite, etc.) also count: if not sure, file 9<br>
Armed conflict
Hazardous duty
Instrumentality of war
Simulated war
Agent Orange exposure disabilities count
Other exposure disabilities as a result of instrumentality of war (radiation, mustard gas, lewisite, etc.) also count: if not sure, file 9<br>
10
CRSC: Features 10 Application-based program (must file a claim) with documentation to show disability is combat-related
Vet will receive special “3rd” payment equal to monthly dollar-for-dollar reduction in military retired pay for combat-related disability(ies)
Tax free
CRSC is separate from retired pay CRSC
(Branch of Service Pays)<br>
Vet will receive special “3rd” payment equal to monthly dollar-for-dollar reduction in military retired pay for combat-related disability(ies)
Tax free
CRSC is separate from retired pay CRSC
(Branch of Service Pays)<br>
11
CRSC: Features Court orders regarding “retired pay” do not include CRSC
But CRSC is not VA pay, so it is subject to:
Child support/alimony
Garnishments
Government debts 11<br>
But CRSC is not VA pay, so it is subject to:
Child support/alimony
Garnishments
Government debts 11<br>
12
CRSC: What is needed for the application? DD Form 2860 (Application)
Retirement orders
20 year letter or statement of service (for reservists)
Relevant pages in VA C-File or service treatment record showing disability
VA rating
Purple Heart award citation if applicable
DD 214 12<br>
Retirement orders
20 year letter or statement of service (for reservists)
Relevant pages in VA C-File or service treatment record showing disability
VA rating
Purple Heart award citation if applicable
DD 214 12<br>
13
CRSC: Application tips The quality of the information is more important than the quantity
Send copies not originals – Branch will not return any documents
Mail or fax to branch of service 13<br>
Send copies not originals – Branch will not return any documents
Mail or fax to branch of service 13<br>
14
CRSC: When to reapply A veteran may reapply for CRSC when:
VA has added more disabilities to their rating that they think might qualify
To reapply: Visit branch of service website for the reconsideration form 14<br>
VA has added more disabilities to their rating that they think might qualify
To reapply: Visit branch of service website for the reconsideration form 14<br>
15
CRSC Payable For veterans in receipt of retired pay based on years of service (RPBOYOS), the amount of CRSC payable is the amount payable for the combined evaluation of the Veteran’s service-connected (SC) combat-related (CR) disabilities (Limited to Gross Retired Pay (GRP)).
Example:
Gross Retired Pay: $2,000
Gross VA Compensation payment: $2,200
CRSC: $2,200 (All disabilities are combat related)
CRSC Payable: $2,000 15<br>
Example:
Gross Retired Pay: $2,000
Gross VA Compensation payment: $2,200
CRSC: $2,200 (All disabilities are combat related)
CRSC Payable: $2,000 15<br>
16
CRSC CALCULATIONS FOR DISABLED RETIREES (Medical Board Retirees) For CRSC Eligible Disability Retirees, Concurrent Receipt is Limited to RPBOYOS
Example:
GRP: $1,600
RPBOYOS: $600
Gross VA compensation payment: $1,100
CRSC: $1,100 (all disabilities are combat related)
Concurrent Receipt is limited to $600
Net Retired Pay (NRP) (GRP – GVA) = $500
Therefore, CRSC is $100
The Veteran will receive $1,100 from VA and $600 from DFAS ($500 in Retired Pay and $100 in CRSC) 16<br>
Example:
GRP: $1,600
RPBOYOS: $600
Gross VA compensation payment: $1,100
CRSC: $1,100 (all disabilities are combat related)
Concurrent Receipt is limited to $600
Net Retired Pay (NRP) (GRP – GVA) = $500
Therefore, CRSC is $100
The Veteran will receive $1,100 from VA and $600 from DFAS ($500 in Retired Pay and $100 in CRSC) 16<br>
17
Concurrent Retired and Disability Pay (CRDP) Eligibility CRDP is a program which allows concurrent receipt of uniformed service retired pay and VA compensation. Veterans must have a combined VA service-connected evaluation of at least 50% and be retired based on longevity* or retired due to disability with at least 20 years of service.
CRDP is not a special payment; rather, it is included with Veterans’ military retired pay. As with CRSC, sometimes VA must reduce retroactive retired pay withholdings for a Veteran to receive his/her full CRDP entitlement.
*Veterans retired under the Temporary Early Retirement Authority (TERA) are retired based on longevity. 17<br>
CRDP is not a special payment; rather, it is included with Veterans’ military retired pay. As with CRSC, sometimes VA must reduce retroactive retired pay withholdings for a Veteran to receive his/her full CRDP entitlement.
*Veterans retired under the Temporary Early Retirement Authority (TERA) are retired based on longevity. 17<br>
18
CRDP Amount Veterans in receipt of RPBOYOS receive the full amount of their retired pay and VA compensation if their VA compensation rating is 50 percent or greater.
Example: (CRDP based on RPBOYOS)
RPBOYOS: $1,400
Gross VA (GVA): $950
$1,400 (RPBOYOS) + $950 (GVA) = $2,350 18<br>
Example: (CRDP based on RPBOYOS)
RPBOYOS: $1,400
Gross VA (GVA): $950
$1,400 (RPBOYOS) + $950 (GVA) = $2,350 18<br>
19
CRDP for Medically Retired Reservists Medical retirement only counts active duty time
If the veteran served 20 “good years” in the reserves but was medically retired with less than 20 years active duty, the veteran must wait until age 60 to qualify for CRDP
The veteran may qualify for CRSC before age 60 if there are any combat related disabilities 19<br>
If the veteran served 20 “good years” in the reserves but was medically retired with less than 20 years active duty, the veteran must wait until age 60 to qualify for CRDP
The veteran may qualify for CRSC before age 60 if there are any combat related disabilities 19<br>
20
CRDP Process No application required; DFAS automatically determines eligibility
Opted for the VA waiver
Military payments are taxable (DFAS statement); VA benefits are not taxable
Will receive gross retired pay, not “3rd payment” 20<br>
Opted for the VA waiver
Military payments are taxable (DFAS statement); VA benefits are not taxable
Will receive gross retired pay, not “3rd payment” 20<br>
21
CRDP Features CRDP is essentially a substitute for a portion of military retired pay that must be waived
Because it is a restoration of retired pay and is not VA pay, the gross amount of CRDP may be reduced for
Taxes
Child support/alimony
Garnishments
Government debts 21<br>
Because it is a restoration of retired pay and is not VA pay, the gross amount of CRDP may be reduced for
Taxes
Child support/alimony
Garnishments
Government debts 21<br>
22
Audit Error Worksheet (AEW) VA releases retroactive retired pay withholdings due veterans as a result of CRSC/CRDP entitlement via the AEW process:
VA promulgates an award and withholds retroactive compensation
The VA award lines are transmitted to DFAS/USCG via a bi-weekly combined interface file (CIF)
DFAS/USCG determines CRSC/CRDP eligibility and calculates amounts due 22<br>
VA promulgates an award and withholds retroactive compensation
The VA award lines are transmitted to DFAS/USCG via a bi-weekly combined interface file (CIF)
DFAS/USCG determines CRSC/CRDP eligibility and calculates amounts due 22<br>
23
Audit Error Worksheet (AEW) continued If DFAS/USCG determines amounts are due from VA, they send VA an audit
DFAS electronically transmits audits to VA in a single file during the first week of each month
USCG sends audits to VA on a CD via US mail once a month
VA transforms the audit into an AEW
DFAS AEWs are automatically uploaded into VBMS and a “work item” is automatically established on each AEW
USCG AEWs are manually uploaded into VBMS and VAROs are notified via email that the AEW needs to be worked 23<br>
DFAS electronically transmits audits to VA in a single file during the first week of each month
USCG sends audits to VA on a CD via US mail once a month
VA transforms the audit into an AEW
DFAS AEWs are automatically uploaded into VBMS and a “work item” is automatically established on each AEW
USCG AEWs are manually uploaded into VBMS and VAROs are notified via email that the AEW needs to be worked 23<br>
24
AEW Payment Normally it takes approximately 35 to 100 days from the date of the VA award action to receipt of the audit from DFAS. However, most audits are received approximately 65 days from the date of the VA award action.
DFAS does not send VA audits one at a time.
DFAS does not send VA audits on a day other than a day during the first week of the month
Most AEWs are processed automatically within 24 hours of the date the audits are received from DFAS. Payment will be made within 5-7 days.
AEWs not automatically processed must be manually processed. 24<br>
DFAS does not send VA audits one at a time.
DFAS does not send VA audits on a day other than a day during the first week of the month
Most AEWs are processed automatically within 24 hours of the date the audits are received from DFAS. Payment will be made within 5-7 days.
AEWs not automatically processed must be manually processed. 24<br>
25
Taxes and VA benefits If an award of CRSC or CRDP results in a reduction of tax liability (veteran was paid taxable retired pay and should have been paid non-taxable VA or CRSC), the veteran can file an amended tax return
The Court case allowing an amended tax return for retroactive VA awards is called the Strickland decision and Revenue Ruling 78-161
DFAS will not send an amended 1099-R for retro years, only for the present year
Consult a tax professional to determine whether to file amended return: Military retirees may go to the legal assistance office/tax center on many bases for help 25<br>
The Court case allowing an amended tax return for retroactive VA awards is called the Strickland decision and Revenue Ruling 78-161
DFAS will not send an amended 1099-R for retro years, only for the present year
Consult a tax professional to determine whether to file amended return: Military retirees may go to the legal assistance office/tax center on many bases for help 25<br>
26
26 Program Comparison<br>
27
CRSC/CRDP Fast Facts CRSC
Any combat-related, compensable service-connected disability.
CRSC is not retired pay and is a tax-free entitlement that is paid separately from VA disability compensation and retired pay.
Enrollment is not automatic. Veterans must apply to their branch of service CRSC board (DD Form 2860).
Payment is based on VA compensation rate tables (20% CRSC=20% rate from VA rate tables). CRDP
Veterans must have a combined VA disability evaluation of 50% or more and be retired due to longevity. Disability retirees must have at least 20 years of service.
CRDP is considered retired pay, is taxable, and is not a separate payment. It benefits the Veteran by increasing net retired pay.
Payment is determined by the Defense Finance and Accounting Service (DFAS) or Coast Guard (CG). 27<br>
Any combat-related, compensable service-connected disability.
CRSC is not retired pay and is a tax-free entitlement that is paid separately from VA disability compensation and retired pay.
Enrollment is not automatic. Veterans must apply to their branch of service CRSC board (DD Form 2860).
Payment is based on VA compensation rate tables (20% CRSC=20% rate from VA rate tables). CRDP
Veterans must have a combined VA disability evaluation of 50% or more and be retired due to longevity. Disability retirees must have at least 20 years of service.
CRDP is considered retired pay, is taxable, and is not a separate payment. It benefits the Veteran by increasing net retired pay.
Payment is determined by the Defense Finance and Accounting Service (DFAS) or Coast Guard (CG). 27<br>
28
Frequently Asked Questions Is a Veteran who retired under the Temporary Early Retirement Authority with less than 20 years of service eligible for CRDP?
Answer: Yes, provided the Veteran has a combined service- connected evaluation of 50% or greater.
Can a Service member apply for CRSC prior to being discharged?
Answer: No. A VA rating decision is required before applying for CRSC.
Is a Reservist with a 20-year letter who is in receipt of disability retired pay eligible for CRDP prior to age 60 or the eligibility age applicable under 10 U.S.C. 12731(f)(2)(A)?
Answer: No. Such a retiree would not be eligible for CRDP until reaching age 60, or the eligibility age applicable under 10 U.S.C. 12731(f)(2)(A). 28<br>
Answer: Yes, provided the Veteran has a combined service- connected evaluation of 50% or greater.
Can a Service member apply for CRSC prior to being discharged?
Answer: No. A VA rating decision is required before applying for CRSC.
Is a Reservist with a 20-year letter who is in receipt of disability retired pay eligible for CRDP prior to age 60 or the eligibility age applicable under 10 U.S.C. 12731(f)(2)(A)?
Answer: No. Such a retiree would not be eligible for CRDP until reaching age 60, or the eligibility age applicable under 10 U.S.C. 12731(f)(2)(A). 28<br>
29
Frequently Asked Questions If a disability retiree is in receipt of VA compensation and their branch of service determines that one or more VA service connected disabilities are combat-related, will they receive CRSC?
Answer: Maybe. For disability retirees, if Net Retired Pay (GRP – GVA) is greater than or equal to RBOYOS, CRSC is not payable.
If a veteran doesn’t agree with the amount of CRSC received, should they contact VA?
Answer: No. VA does not pay or calculate CRSC. They should contact their retired pay center. (DFAS or CG) 29<br>
Answer: Maybe. For disability retirees, if Net Retired Pay (GRP – GVA) is greater than or equal to RBOYOS, CRSC is not payable.
If a veteran doesn’t agree with the amount of CRSC received, should they contact VA?
Answer: No. VA does not pay or calculate CRSC. They should contact their retired pay center. (DFAS or CG) 29<br>
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QUESTIONS?<br>
31
CRSC & CRDP Please scan the QR Code or click on the link below to take an anonymous survey about your experience during the Training Conference. https://www.research.net/r/ZGGSQ7F<br>