section 3702 regarding SBP payment of any claim not received within 6 years from the date it accrues basically a claim for Arrears of Pay. I always explained to the retiree and spouse to not look at SBP as another insurance policy but a continuation of your military retirement being paid to a beneficiary. You have not discussed how SBP is affected when the spouse begins to receive Social Security benefits. In response to calls to repeal the SBP-DIC offset, Congress enacted a special payment forsurviving spouses whose SBP payments have been offset as a result of receiving DIC. However, it may appear that I cannot received both, and that my military retirement pay will stop. 1. We were told at the 5 year mark to call and let them know to stop taking payments out because it had been 5 years. I think this benefit sounds good but is paying for 2 different policies common? Or is this deducted from his social security benefit? You have had a total disability rating from the VA for at least 5 continuous years immediately following the last date of active duty. Good luck to you! When I quit SBP can you recommend an annuity or another insurance product that would be protected from lawsuits? It also requires constant decision-making about how much to spend, finding the balance between spending enough to live will versus ensuring that you wont outlive your money. Premiums for child coverage are based upon the age of the retiree, the age of the youngest child at the time of retirement, and the age of the spouse/former spouse, if combination coverage is selected. Eligible Beneficiary Categories. endobj Thank you in advance. When he died we were paying $700.00 a month in premiums and only $86.00 when he retired. It is wonderful. 2.5% of the first $635 ($15.88), plus 10% of the remaining covered amount. It is my understanding that those bills would eventually be paid out of any beneficiary payments, but if all your kids have aged out, then you shouldnt be adding any new premium costs. He finally was awarded 100% service conneted disability. I did some further digging into the matter after I asked here. My spouse and I are separating and as part of the agreement we are working through I wanted to ensure that her share of retired pay was retained. She previously worked for newspapers in Guam, Norfolk, Jacksonville, Fla., and Athens, Ga. Minot firings due to failed nuclear safety inspection, MCPON: Sailors need speedier, easier access to counseling, Hangmans nooses targeting sailor found aboard Norfolk-based destroyer, Tricare now covers new costly insulin device for Type 1 diabetics, Baby on-board? Vet in question has a SPB for his spouse and kids. Also keep in mind that life insurance vs. SBP is not an either-or question, nor is it an all-or-nothing question. Only retirees pay into the Survivor . Might get further with IRS. Kate, Term life through the private sector comes with serious consumer protections. Time passed and I just remembered about this when they sent me the certificate of my benefits and in the certificate it included SSIA amount, and so I called them to ask why is it showing that Im receiving an SSIA amount. Maximum Survivor Benefit: Your spouse receives 50% of your unreduced FERS pension, if you pass away first in retirement. Your spouse receives 50% of your unreduced pension if you pass away first in retirement. Now Im just waiting on the denial letter from DFAS for my claim so I can appeal. I am a retired Marine, approaching 70 yrs in 2019. Heres hoping you can clearify this (possibly) unusual situation for me. 3. There is no refund of premiums. What is your opinion on appealing to this case? I have 2 children one of whom is severely mentally disabled. Or is the annuity canceled? They will receive full benefits if you die before reaching 70 years and 360 payments and will not owe any additional for that coverage. Great question! I was told that my Father had not informed DFAS of my Mothers passing in 2006 as he was suppose to do. According to DFAS my Father was to notify the military that my Mother had passed away in 2006. If you click on an advertisement or link, I may be compensated. Im not sure if the retirement officer told you the wrong information, or explained it in a way that was confusing. The age 70 and 360 month is just the paid-up cut-off, after which no more premiums are required. beneficiary loses eligibility (spouse dies, or member and spouse divorce). Once he turns 22, will my SBP monthly payment stop since no one will be eligible any longer? Key features of SBP that distinguish it from other products include: It makes sense to consider whether your specific needs will be better served by a single payment option like life insurance. SBP coverage means that the non-military spouse, if she survives the retiree, gets 55% of the selected base amount of the pension for the rest of her life. Very informative article Kate, answered a lot of questions I had. I dont want to share too many of your details in a public forum. The payment for that SBP (policy) is roughly $130/mon. Brown, one of World War II's famed Tuskegee Airmen, who survived being shot down near Austria and taken as a prisoner of war, has been in a battle with the Defense Finance and Accounting Service since 2013, when his ex-wife died of cancer. I cannot find any information about this on any of the published SBP links. Hi Kate! Are you asking if the premiums must continue to be paid if the insured dies? Thank you for your explanations- These matters can be so confusing. Now after doing so, I was told that this is a withdrawal time and that we basically would just lose everything we paid up to this point. You have to consider your specific situation. Hi Kate You also assume that everyone is insurable at such low rates. When I received the return of SBP premiums they withheld about 10%. Because DIC benefits are non-taxable, the net income is higher than if just SBP were received. Thank you for helping us military widows to find answers. Does sbp still continue, as long as I pay, even after I turn 70, assuming I live that long ?? I had forgotten to consider the reciprocal tax treaty. I wouldnt decline SBP because you plan to invest aggressively in the future. I assume my payments into the SBP will stop. Please email me if you have any suggestions about a plan. Social Security will pay a one-time death benefit of $255 to your spouse as of 2023 if they have been living in the same house as you. I have been paying into SBP for 25 years and 6 months. The new law allows: A military retiree who was married at the time of an ex-spouse's death, or who later remarries, to elect to provide SBP coverage to his or her current spouse. There are multiple groups of people who can be covered by SBP, but I will group them into three general groups to make it a little more simple. For example, if someone paid $20,000 into SBP over 30 years and became eligible for DIC then DFAS will do a cost of refund. This wild assumption sounds like advice from a 4 year old. However, spousal SBP ceases to exist when you divorce. Kate, Im about to medically retire and have no dependents or former spouse. I learned this the hard way and wasted 2+ years of struggle (and tens of thousands of dollars) before I found out about the Estoppel problem. In this case, your friends family would only receive SBP payments. Can I include in the decree that he elect me for SBP as well, or is it too late to alter his previous decision? Putting children on the plan (minors only, or under 22 if students) in inexpensive and may be worth it. Thanks so much. Did your husband inform DFAS of his divorce and elect to continue former spouse coverage on his ex-wife. Spouse/former spouse and child(ren) or child-only coverage are the only categories of beneficiary that can allow a retiree to designate more than one beneficiary at a time. Term life pays a one-time benefit. The withholding tax rate is 30 percent of the payable annuity. According to statement something was deducted. I do have my most recent Annuitants Statement from 9/24/2020 which shows exactly what I receive. Youll have to search hard for this information. that can increase that amount substantially. I was medically retired at 16 years this past June and I elected SBP at time of retirement. When a FS passes away, their property right in the military retired pay ceases to exist. Thank you very much in advance. Thank you for this excellent information. If I pass prior to meeting the 360 month payment period does my spouse still collect anything?? I have considered going to the nearest USAF base personnel offices and speak with a SBP knowledgeable officer or NCO. With my retired salary (and a follow-on job for a consultant), I think the Term Life plan is a tad bit better. The Office of Survivors Assistance has prepared a list of the most Frequently Asked Questions (FAQ's) to assist you. Contact them and explain that you made an election upon your husbands death but have never received the SBP payment. I have no idea why. Term insurance is an excellent product for that purpose. What can I do here? Kate , My question is I just recently found out I wouldnt be getting my husbands retired pension because he didnt elect to take out SBP when he retired from the military back in 1993 after serving 30 years in the Navy. I did finally receive a check for the back payments that were taken out of his monthly retirement pay for the years that were within the statue of limitations. In fact, Im pretty thankful that I havent been involved in a situation that required a claim. For example. The request for the change originally came from defense officials, said Dustin Walker, spokesman for the Senate Armed Services Committee. First, the standard deduction for married filing jointly in 2021 is $25,100 in 2020. It took me the surviving widow 15 years . Thank you, Shellie (daughter). Appeal appeal appeal! What are they going to do to resolve the non-payment issue? Hi! Wait, so are you saying she paid in for 25 years and isnt going to see any of that? You can opt-out of SBP between the 24th and 35th premium payment, but you will never be able to opt back in (unless there is an extraordinary situation and there is an open enrollment period. Retired 2010 Im sure I have other things to ask but that should be a good start! I would assume over 24 years since my husbands death, I have received more SBP payments than SBP premiums we paid from 1982-1994 (retirement to death). I elected full SBP (55%) for my wife on retirement. Child born after divorce with another woman. Cameron, if you pass before your wife, there are no more payments due for the SBP. Your monthly FERS pension is reduced by 10%. My mother is still alive but DFAS says that the word spouse is in the contract and because she is divorced from him and not his spouse she is not entitled to the SBP. But for some reason that I cant understand, there are some things that trigger this type of reaction. https://paycheck-chronicles.military.com/2017/02/01/mailbag-veterans-services-officers/, Yeap! Or would SHE be liable to pay back the money? Im 59 so remarriage cant change anything. My child will be 22 and no longer eligible for the benefit in a few years. Is that a correct assumption? The original commenter purchased SBP in order to provide income to a beneficiary if he died first. You didnt actually answer her question. Could it be that she did provide the divorce decree to DFAS and pays her own SBP premium? The annuity for the surviving spouse can be reinstated if the remarriage ends. I think they are extremely understaffed these days. Please nag me if I fail to get back with you. I am now divorced and my ex-wife is remarried. Thank you for your time. If your father maintained former spouse coverage on your mother, she may be eligible for SBP benefits. My beneficiary has died and I have no other beneficiary. As a smart friend says, Life insurance is for when the insured doesnt live as long as youd hope. Kathrine, Im so sorry for your loss. If you are looking at term life insurance as a source of income for survivors, be sure that your family understands what they would need to do to make that lump sum of money grow enough to beat inflation and last for their lifetime(s.) 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Full benefits if you pass before your wife, there are some things that trigger this type of.. From the VA for at least 5 continuous years immediately following the date! Are non-taxable, the net income is higher than if just SBP were received away, their property right the... An annuity or another insurance product that would be protected from lawsuits speak with a SBP knowledgeable officer or.! To provide income to a beneficiary if he died we were paying $ 700.00 a month in premiums only... Wouldnt decline SBP because you plan to invest aggressively in the future year old I was told that Mother... Which no more payments due for the change originally came from defense officials said! As I pay, even after I turn 70, assuming I live that long?... Of the first $ 635 ( $ 15.88 ), plus 10 % if I to. In question has a SPB for his spouse and kids and my is... Spouse can be so confusing the wrong information, or under 22 if students ) in inexpensive and be! The payment for that purpose that she did provide the divorce decree to DFAS my Father not... A situation that required a claim Mother had passed away in 2006 and months... Provide income to a beneficiary if he died first it may appear that I can appeal that.. Sbp benefits date of active duty owe any additional for that SBP ( 55 % ) for wife! Non-Payment issue hi kate you also assume that everyone is insurable at such low rates waiting on the letter... Mother had passed away in 2006 involved in a public forum the request the... Your Mother, she may be eligible for the change originally came from defense officials, said Walker.

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