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Vol. 72, No. 8, August 1999 |
 Previous Page
A Primer on Dividing a Military Pension
Practice pointer. Life insurance often can be considered
in lieu of SBP protection. This substitute protection can work
well for a member who intends to remarry and desires SBP coverage
for his or her subsequent spouse. For example, if a former spouse
was married to a member for only the first 10 years of his or
her military service, and the member is a long way from being
eligible to retire, that former spouse may wish to negotiate
the type of survivor protection needed. The former spouse's award
could be equally protected by life insurance while keeping the
SBP designation open for a potential subsequent spouse of the
member (who may be married to the member for an even longer time).
If through settlement negotiation, the military member elects
to provide SBP protection for future retired pay, that agreement
must be in writing and become a part of the divorce judgment
or decree. This becomes an enforceable state court order.24 The judgment or state court order must
be communicated to the military within one year of the date of
the order, and the order or judgment must be certified by the
issuing court within 90 days of its receipt by the military's
Defense Finance and Account Service
(DFAS).
Application for SBP election or election change may be made
on form DD-2656-1 and must be received within one year of the
date of the divorce judgment24
by the military's Defense Finance
and Account Service
An often overlooked practice pitfall is worth noting. If the
parties are divorcing after the service member has retired and
the member already has elected SBP coverage for the spouse, you
must be sure that the member is ordered to change the SBP election
from "spouse" to "former spouse" coverage.
A failure to do that will result in the loss of coverage for
the spouse because he or she has just become a former spouse.
90-day Delay
If a member is receiving retired pay benefits when the state
court order is served on the Defense
Finance and Account Service, there will be a minimum 90-day
delay before benefits commence to the former spouse. If the member
is not yet receiving retired pay benefits when the state court
order is served on the Defense Finance and Accounting Service,
there still will be a minimum 90-day delay before benefits commence
to the former spouse.
Practice pointer. During the delay, the member will
receive the entire amount of his or her retired pay, including
the amount intended for the former spouse. The former spouse
will receive nothing during the delay. It seems both equitable
and appropriate to require the member to reimburse the former
spouse for any amounts received by the member that were intended
for the former spouse.
Submitting the State Court Order to the Military
Along with the court certified copy of the state court order,
the Defense Finance and Account
Service Center will require a copy of the marriage certificate
necessary to prove 10 years of marriage, a copy of the divorce
judgment sealed with the official court certified seal and dated
within 90-days immediately preceding its service to the Cleveland
Center, and a completed and signed DD Form 2293 (application
for former spouse payments from retired pay). DFAS also will
require submission of DD Form 2656-1 (Survivor Benefit Plan election
statement) signed by both parties and witnesses. The completed
DD Form 2656-1 should be mailed to the address specified on the
form. In the event the former spouse needs to request to be deemed
the former surviving spouse for SBP coverage, a written request
should be sent in duplicate with one copy accompanying the state
court order and the other being mailed to the address to which
DD Form 2656-1 otherwise would be mailed. If additional documentation
is required or requested, DFAS will notify the former spouse.
Remember the Fringes
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David B. Halling, U.W. 1962, is president of Halling & Cayo S.C., Milwaukee.
Wendy Drefahl is president of WFA Econometrics Corp., Milwaukee. The authors thank Edwin C.
Schillin of Aurora, Colo., for his contributions to and review of an early draft of this article.
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A commonly overlooked, but substantial, benefit to a former
spouse is the access to medical, commissary, and base exchange
privileges. These are available in varying degrees, depending
upon reserve or active service, length of service, length of
marriage, and length of overlap between the marriage and service.25 With a 20-year overlap, the former
spouse is entitled to full benefits. Remarriage will result in
the irrevocable loss of medical benefits, but commissary and
base exchange privileges may be reinstated if the remarriage
ends. With only a 15-year overlap the privileges are more limited.
Details on these privileges, compiled by the Department of the
Navy, are set forth in the accompanying
sidebar. Further information may be obtained by writing the
individual military services.
Conclusion
The authors have endeavored to give a brief overview of the
statutory concepts, regulations, and research sources applicable
to the division of military retired pay upon divorce. A final
caution is needed: Practitioners should be wary of forms, because
there is no substitute for a careful lawyer's judgment, independently
exercised, on a case-by-case basis.26
Endnotes
1 Though also applicable to present
spouses and children, it also is available to former spouses.
10
U.S.C. 1408 and 1447.
2 10
U.S.C. 1408(d)(4).
3 10
U.S.C. 1331(a). Active duty personnel needn't wait to age
60.
4 10
U.S.C. 1408(d)(1) and (2),
and 32
C.F.R. 63.6(a)(2).
5 10
U.S.C. 1408(e)(6), and 32
C.F.R. 63.6(a)(2).
6 29
U.S.C. 1003(b)(1) and 1051.
7 10
U.S.C. 1408(c)(4). Be careful of the difference between residence
and domicile. A residence is where you live now but a domicile
also includes an intention to make it one's fixed and permanent
home.
8 10
U.S.C. 1408(e)(1).
9 Cook
v. Cook, 208 Wis. 2d 166, 560 N.W.2d 246 (1997).
10 10
U.S.C. 1408(e)(1).
11 10
U.S.C. 1408(a)(4).
12 10
U.S.C. 1408(c)(3).
13 10
U.S.C. 1448(3)(a)(i). Defense Finance and Accounting Service,
DFAS-Cleveland/Code L, P.O. Box 998002, Cleveland, OH 44199-8002.
14 Leighton v. Leighton,
81 Wis. 2d 620, 261 N.W.2d 457 (1978).
15 Pfeil v. Pfeil, 115
Wis. 2d 502, 341 N.W.2d 699 (1983), 38 U.S.C.A. 3101 sub. A.
16 Soldiers' and Sailors' Civil
Relief Act of 1940, 50 U.S.C. App. 501 et seq.
17 Title
10 U.S.C. 1408(d)(4).
18 Title
10 U.S.C. 1447. Also, the wisdom of acquiring private insurance
to accomplish the same goal is not discussed here, but worthy
of consideration. To evaluate the options, one should ascertain
the premium for the SBP (which will reduce the payment to the
former spouse) and compare it with the premium cost for private
insurance (annuity).
19 10
U.S.C. 1448(2)(B). A member on active duty may do so only
once, that is, when he or she retires.
20 32
C.F.R. 63.6(5).
21 10
U.S.C. 1408(c)(1) and (c)(3).
22
Title 10 U.S.C. 1450(f)(3)(A).
23 Title
10 U.S.C. 1448(d).
24 32
C.F.R. 63.6(c) and 10
U.S.C. 1450(f)(3)(B). Also see form DD-2293, available from
DFAS-Cleveland Center, P.O. Box 99191, Cleveland, OH 44199-1126.
Forms can be obtained from the same location, the Internet
Web site, or any military base.
25 10
U.S.C. 1072(2).
26 A reference work has been published
recently by the American Bar Association Section of Family Law:
"Military Retirement Benefits in Divorce," by Marshal
S. Willick (1998).
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