How does the calculation work?

J

JoeSnuffy38

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Registered Member
Army Reserve, 21 years (reserve), 3 combat tours, disability retirement, ~3500 points, O5, 70% DoD, 100% VA. I hear a lot about the VA waiver, but I don't really know what to do. I've got about 15 years before I can draw my actual retirement from the Army reserve, but I'll be getting the disability retirement. Will I have to for go my VA check or will some of it be replaced by my disability retirement? Or will I get both (wishful thinking). I am also trying to figure out how to calculate if I get 100% CRSC (I haven't applied yet, but really want some help figuring it out).

Sending up a signal flare for help!
 
JoeSnuffy38 said:
Army Reserve, 21 years (reserve), 3 combat tours, disability retirement, ~3500 points, O5, 70% DoD, 100% VA. I hear a lot about the VA waiver, but I don't really know what to do. I've got about 15 years before I can draw my actual retirement from the Army reserve, but I'll be getting the disability retirement. Will I have to for go my VA check or will some of it be replaced by my disability retirement? Or will I get both (wishful thinking). I am also trying to figure out how to calculate if I get 100% CRSC (I haven't applied yet, but really want some help figuring it out).

Sending up a signal flare for help!
Click to expand...
Hello,

Hello @JoeSnuffy38

Your questions involve several laws and with some complex features.

1. Will I have to for go my VA check or will some of it be replaced by my disability retirement?
COMMENT: Your disability retired pay will be reduced dollar for dollar the amount of VA compensation received. Any retired pay in excess of the reduction/waiver/offset will be disbursed to you. Please note that not every case involves a total reduction of retired pay.
2. Some of all of the waived retired might be replaces by CRSC. The amount of CRSC for a disability retiree is the
LESSER
of
--the longevity portion of retired pay
or
--the amount and percentage in the VA compensation tables that mirrors the CRSC approval with number of dependents

3. Your disability retired pay will use the higher of two multipliers:
--The longevity multiplier (e.g., active duty equivalent years and months x 2.5% (2% for blended retirement) = longevity multiplier.
--The DoD multiplier

4. The higher multiplier x average high three base pay = disability retired pay

5. CRSC requires an application.

Ron
 
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CRSC info:

2. DoD Retired Pay and VA Compensation LINK <----
3. Army CRSC Page LINK <—-
4. Collection of CRSC information LINK <—-

Ron

edited to add:

Waiver.

Accepting VA compensation and agreeing to waive retired pay dollar for dollar in the amount of the VA compensation often leaves retired pay that is in excess of the VA amount. You get to keep it.
 
Wow, this is insightful. It sounds like it would be most financially beneficial to waive my VA pay as soon as I get my first paycheck from DOD because it will be reduced by the VA amount. (Net being the overage from DOD disability - VA pay).

The part still confusing is the CRSC. I think the next step would be to apply for CRSC (now? I have the documentation) and let that application process/timeline play itself out. I don't understand the waiver concept. Here is my assumption: Waive VA pay, get net DOD disability pay. From there, I'm able to get (if approved) CRSC which is equal to the equation from your post above (also, not totally clear on the calculation piece).

Is there a document number for the VA waiver (the internet sucks for this search)?
 
JoeSnuffy38 said:
Wow, this is insightful. It sounds like it would be most financially beneficial to waive my VA pay as soon as I get my first paycheck from DOD because it will be reduced by the VA amount. (Net being the overage from DOD disability - VA pay).

The part still confusing is the CRSC. I think the next step would be to apply for CRSC (now? I have the documentation) and let that application process/timeline play itself out. I don't understand the waiver concept. Here is my assumption: Waive VA pay, get net DOD disability pay. From there, I'm able to get (if approved) CRSC which is equal to the equation from your post above (also, not totally clear on the calculation piece).

Is there a document number for the VA waiver (the internet sucks for this search)?
Click to expand...
Hello @JoeSnuffy38

1. You said: "It sounds like it would be most financially beneficial to waive my VA pay as soon as I get my first paycheck from DOD because it will be reduced by the VA amount. (Net being the overage from DOD disability - VA pay). VA compensation is NOT waived. Retired pay is waived as I described above (by the amount of the VA compensation).

2. Since I have addressed this issue dozens of times, I copied an old post from elsewhere for the answer to one of your questions.

It follows:
As I have mentioned often, I have never seen one case where a retiree benefited from declining VA compensation.

Your DoD retired pay will be reduced dollar for dollar in the amount of VA compensation. You get to keep any retired pay that is in excess of the VA comp amount.
You receive all your VA comp too in this scenario PLUS you might be eligible for CRSC which could replace some of he retired pay waived.
See A Supplement to CRSC Information <---LINK

If you refuse VA comp (which is nontaxable) all you receive is your DoD retired pay...period.

The block on the VA claim form where one agrees to waive retired pay dollar for dollar etc., is block 26.

If you check the box...you have indicated you don't want VA comp...which is an unfortunate mistake based on my experience. Do not check box 26. My opinion.

There may be different editions of the VA orm. claim for VA compensation, but the one I see on line reads ( bold added):

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.

26. Do NOT pay me VA compensation. I do NOT want to receive VA compensation in lieu of retired pay.


If you did check block 26, you would need to submit a VA form 21-651 to change that. You may want to consult with your VSO or VA to see what your waiver of retired pay status actually is.

3. You said: "Here is my assumption: Waive VA pay, get net DOD disability pay. From there, I'm able to get (if approved) CRSC which is equal to the equation from your post above"
COMMENT: NO. You do not waive VA compensation; it is the retired pay that gets waived if you want any chance of receiving CRSC which replaces some or all of your waived retired pay. And...CRSC is the lesser of the two formulas or amounts I cited for CRSC.
Some of all of the waived retired might be replaces by CRSC. The amount of CRSC for a disability retiree is the
LESSER
of
--the longevity portion of retired pay
or
--the amount and percentage in the VA compensation tables that mirrors the CRSC approval with number of dependents

4. One cannot apply for CRSC until they are in a retired status.

5. Recommend you visit with your PEBLO about the material discussed here. A Physical Evaluation Board Liaison Officer (PEBLO) assists service members as they undergo the medical discharge process.

Ron
cc: @Provis
 
DFAS Retired Pay and VA Compensation for Chapter 61 Retirees with Less than 20 Years Active Duty

Each Chapter 61 disability retiree will receive two separate ratings.
--DoD rating for only those disabilities that make the member unfit for continued service. The DFAS and USCG pays military retired pay.
--VA rating for ALL service-connected disabilities. The VA pays VA compensation.

The retiree has an option to select VA compensation and waive retired pay in an amount equal to the amount of VA compensation. I have never seen one case where it was better to decline VA compensation, irrespective of the VA percentage being 10%, 20%, or 100% (using only a few examples). If the amount of VA compensation is less than the amount of the DoD retired pay, the retiree gets to keep the amount in excess of the VA compensation amount (known as residual retired pay) paid by DFAS or USCG, in addition to their VA compensation.

In no case is the amount of VA compensation reduced, in the context of this discussion, unless the retiree refuses to accept VA compensation.

The myth that the retiree receives the higher of VA compensation or DoD Retired Pay, is misleading since there is the possibility of residual retired pay. See the comment above pertaining to residual retired pay.

Here is one example of the computation of retired pay and VA compensation.

1. Using your info, your retired pay will be average high three base pay multiplied by 70% = DoD retired pay
2. Using your info, your VA compensation (100%) will be an amount in excess of $3000.
3. Your retired pay will be reduced dollar for dollar in the amount of VA compensation received.
4. If any retired pay is left over (i.e., residual retired pay), you get to keep it. You also are paid your VA compensation.
5. Most retirees having a similar situation end up with just the VA compensation as there is zero residual retired pay.
6. If eligible for CRSC and your application is approved by your service, some or all of the retired pay reduced/waived, can be replaced by CRSC.

Note: The example percentage at item 1 would be the DoD disability percentage. However, if the longevity multiplier was higher, it would be used instead.

Average High Three Base Pay: The total of the highest 36 months base pay divided by 36.
Multiplier Percentage: can be either. whichever is higher:
  • Member’s percentage of disability determined by the military service (this is the DoD Disability Percentage). Example: 70%
  • Years of creditable service times 2.5% or 2.0% (2.0% is for previous enrollment in the Blended Retirement System prior to the disability) Example: 12 years active duty x 2.5% = 30% longevity multiplier
Disability Retired Pay:

Average high three base pay x the higher multiplier =
Retired Pay


Note 2: that in both cases the multiplier is limited to 75% by law

This discussion does not include CRDP for which some retirees qualify.

—-
Ron
 
You've definitely clarified the question. I did not check block 26 (thankfully, I know better now). :) I'll be in retired status in 21 days. At that time, I'll apply for CRSC. My PEBLO was very good, but they didn't have a strong handle on this part.

This was very, very informative. Last question (assuming 100% CRSC):

As a reservist, my longevity pay would be less than my waived retired disability pay (from DOD). Would this mean I would get option B (the amount and percentage in the VA compensation tables that mirrors the CRSC approval with the number of dependents) or option A (the longevity portion of retired pay)?

I imagine DFAS would make the decision for me, so this question might be irrelevant.
 
JoeSnuffy38 said:
You've definitely clarified the question. I did not check block 26 (thankfully, I know better now). :) I'll be in retired status in 21 days. At that time, I'll apply for CRSC. My PEBLO was very good, but they didn't have a strong handle on this part.

This was very, very informative. Last question (assuming 100% CRSC):

As a reservist, my longevity pay would be less than my waived retired disability pay (from DOD). Would this mean I would get option B (the amount and percentage in the VA compensation tables that mirrors the CRSC approval with the number of dependents) or option A (the longevity portion of retired pay)?

I imagine DFAS would make the decision for me, so this question might be irrelevant.
Click to expand...
Side comment on the CRSC. You will need to wait 1-2 months after getting out before you can apply for CRSC. You can't apply for CRSC without your VA award letter and it takes a month or 2 to get that. You need your VA ratings to be finalized and the proposed ratings don't count.
 
JoeSnuffy38 said:
You've definitely clarified the question. I did not check block 26 (thankfully, I know better now). :) I'll be in retired status in 21 days. At that time, I'll apply for CRSC. My PEBLO was very good, but they didn't have a strong handle on this part.

This was very, very informative. Last question (assuming 100% CRSC):

As a reservist, my longevity pay would be less than my waived retired disability pay (from DOD). Would this mean I would get option B (the amount and percentage in the VA compensation tables that mirrors the CRSC approval with the number of dependents) or option A (the longevity portion of retired pay)?

I imagine DFAS would make the decision for me, so this question might be irrelevant.
Click to expand...
Your last sentence is accurate.

You will receive the lesser of the two AND if you have residual retired pay (left over from waiver) that could reduce the amount of CRSC.

RON
 
Provis said:
Side comment on the CRSC. You will need to wait 1-2 months after getting out before you can apply for CRSC. You can't apply for CRSC without your VA award letter and it takes a month or 2 to get that. You need your VA ratings to be finalized and the proposed ratings don't count.
Click to expand...
Ironically, I have all my final ratings from the VA. Many folks (even my MSC) said wow, I don't normally see that.
 
Another ceiling: CRSC cannot be more than the waived retired pay.

Another: Combination of CRSC and residual retired pay cannot exceed the longevity portion of retired pay.

Ron
 
JoeSnuffy38 said:
Ironically, I have all my final ratings from the VA. Many folks (even my MSC) said wow, I don't normally see that.
Click to expand...
That may be due to you being a Reservist. Its not possible for Active Duty as they can't have their ratings finalized until they are off active duty by law.
 
Similar question. Reservist. O3. 30% DOD 50%. Not combat related. 20 good reserve years but only 4000 points. How do I calculate?
 
bigfrank7 said:
Similar question. Reservist. O3. 30% DOD 50%. Not combat related. 20 good reserve years but only 4000 points. How do I calculate?
Click to expand...
Hello,

1. What do you mean by 30% DOD 50% ? Is 50% VA?

2.
Here is one example of the computation of retired pay and VA compensation, using the info of another.

1. Using example info, your retired pay will be average high three base pay multiplied by 70% = DoD retired pay
2. Using example info, your VA compensation (100%) will be an amount in excess of $3000.
3. Your retired pay will be reduced dollar for dollar in the amount of VA compensation received.
4. If any retired pay is left over (i.e., residual retired pay), you get to keep it. You also are paid your VA compensation.
5. Most retirees having a similar situation end up with just the VA compensation as there is zero residual retired pay.
6. If eligible for CRSC and your application is approved by your service, some or all of the retired pay reduced/waived, can be replaced by CRSC.

Note: The example percentage at item 1 would be the DoD disability percentage. However, if the longevity multiplier was higher, it would be used instead.

Average High Three Base Pay: The total of the highest 36 months base pay divided by 36.
Multiplier Percentage: can be either. whichever is higher:
  • Member’s percentage of disability determined by the military service (this is the DoD Disability Percentage). Example: 70%
  • Years of creditable service times 2.5% or 2.0% (2.0% is for previous enrollment in the Blended Retirement System prior to the disability) Example: 12 years active duty x 2.5% = 30% longevity multiplier
Disability Retired Pay:

Average high three base pay x the higher multiplier =
Retired Pay


Note 2: that in both cases the multiplier is limited to 75% by law

3. Nonregular retirement at age 60.
Average High Three Base Pay: The total of the highest 36 months base pay divided by 36.
Multiplier Percentage: active duty equivalent x 2.5% or 2% for blended retirement = longevity multiplier
average high three x longevity multiplier = reserve retired pay



Ron
 
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