I’m sure this question has already been asked, but is it worth applying for CRSC while retired after 20 years and collecting 100% VA disability compensation? Is there any benefit? I’m newly retired and still looking into the many options out there, but don’t want to waste my time applying for CRSC if it’s not worth it. Thank in advance!
20 years retired & 100% P&T - CRSC?
- Thread starter usmclleod
- Start date
What is your 20 years? Active duty or reserves?
See DFAS Defense Finance and Accounting Service > RetiredMilitary > disability > comparison <---LINK
CRDP is taxable; CRSC is nontaxable.
Ron
Active. Sorry, I forgot that was an important detail.
I understand that CRSC is nontaxable but it would only be worth it if the CRSC percentage offsets the taxes paid through CRDP? You can still collect VA disability compensation and CRSC retirement at the same time, just like CRDP, correct?
Very new to the concept and everywhere I’ve looked to gather info is pretty confusing. Just dumb it down for me, like I’m five please!!! Thank you.
I understand that CRSC is nontaxable but it would only be worth it if the CRSC percentage offsets the taxes paid through CRDP? You can still collect VA disability compensation and CRSC retirement at the same time, just like CRDP, correct?
Very new to the concept and everywhere I’ve looked to gather info is pretty confusing. Just dumb it down for me, like I’m five please!!! Thank you.
Hello @usmclleod ,
1. CRSC replaces some of all of waived retired pay associated with approved combat related disabilities. Yes, one receives VA comp and CRSC at the same time.
2. In order to receive CRSC one must agree to waive retired pay dollar for dollar in the amount of VA comp received.
in the case of a 20 year AD individual, the CRSC will replace the waived/ offset retired pay only in the amount associated with the approved CRSC percentage (not to exceed longevity amount). The VA comp tables are used to determine the amount.
3. In your case, recommend you select CRSC if the approved CRSC percentage is the same as the total VA comp percentage. If not, choose CRDP.
The above pertains to an inferred 20 year regular retirement (i.e.not reserve or disability). BTW, DFAS will automatically pay the higher of CRSC and CRDP.
Ron
1. CRSC replaces some of all of waived retired pay associated with approved combat related disabilities. Yes, one receives VA comp and CRSC at the same time.
2. In order to receive CRSC one must agree to waive retired pay dollar for dollar in the amount of VA comp received.
in the case of a 20 year AD individual, the CRSC will replace the waived/ offset retired pay only in the amount associated with the approved CRSC percentage (not to exceed longevity amount). The VA comp tables are used to determine the amount.
3. In your case, recommend you select CRSC if the approved CRSC percentage is the same as the total VA comp percentage. If not, choose CRDP.
The above pertains to an inferred 20 year regular retirement (i.e.not reserve or disability). BTW, DFAS will automatically pay the higher of CRSC and CRDP.
Ron
1. Recommend you apply for CRSC.
2. DFAS will automatically pay the higher of CRDP or CRSC.
3. That doesn’t necessarily mean it is the best choice for you. If you have additional taxable income, in some cases it pays to choose the lesser paying CRSC (if it is not equal to the waived amount). Those cases are not particularly common and involve estimating future tax returns. I did it for myself years ago. Again, that is not a common path.
Ron
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As Ron said, "recommend you apply". That's the nice thing about this, applying doesn't hurt what you're getting, just plays the shell game with your taxes, possibly reducing your tax burden. Only you (or an accountant) would know what's best for your circumstances.
Hey Devil,
I was recently approved for CRSC at 100%. I’m also receiving 100% P&T. DFAS will send you a letter indicating which is better (CRDP or CRSC). In my case, CRSC was better. On my pay, my RAS no longer shows and it now appears under the CRSC tab.
What does this mean? I’m not getting my full retirement pension that I’m entitled to tax free. That’s the whole amount. Your CRSC statement will automatically be changed to “0” for both federal and state deductions, that’s if you pay state taxes. You may see other forums state that you’ll get three different deposits, DFAS, VA, your service. But for me, it remains the same, DFAS and VA.
My only question I have now is how to amend my previous years taxes. I was approved CRSC at 80% in 2021 and 100% in 2022. Obviously, my retirement was taxable for those two years prior to applying to CRSC. Not only was my retirement pay check being tax monthly, but I also owed taxes in both 2021 and 2022. I’m almost certain that I’m entitled to some refund since now my taxable income is going to significantly drop.
I applied on 3/11, yup, that’s right 0311 day. I was approved on 10/17.
Hope this helps.
SF
Meant to say “I’m now getting my full retirement pension.”
Hello @DanV_USMC0306
Re: Amended tax returns
Here, I am quoting my own post:
I put together some info on revised tax returns in 2017 (and before). The info is at another board:
Veterans Benefits Network-Amended Tax Returns Due to Retroactive Payment of VA Compensation or Retroactive CRSC--Retirees <---LINK
The last revision was in 2017 and some of the elements have likely changed. The old info might provide a hint of what to do.
I have not kept up with that particular subject and all I have to offer is that the linked info might be helpful in some ways.
Ron
(not a tax professional)
Re: Amended tax returns
Here, I am quoting my own post:
I put together some info on revised tax returns in 2017 (and before). The info is at another board:
Veterans Benefits Network-Amended Tax Returns Due to Retroactive Payment of VA Compensation or Retroactive CRSC--Retirees <---LINK
The last revision was in 2017 and some of the elements have likely changed. The old info might provide a hint of what to do.
I have not kept up with that particular subject and all I have to offer is that the linked info might be helpful in some ways.
Ron
(not a tax professional)
If this helps, these conditions were approved for CRSC Navy. I retired over twenty and collecting VA. If you are 100 percent CRSC DFAS will find which is the better benefit. Cannot do both CDRP and CRSC at the same time.
Ref: (a) 10 U.S.C. §1413a
1. Your application for Combat-Related Special Compensation (CRSC) are approved per reference (a). In making this decision, the following determinations were made regarding the diagnoses considered:
COMBAT-RELATED:
Diagnosis | VASRD | VA% | Determination | B/L Factor | Claim Date | CRSC Eff Date |
PTSD, MDD, Insomnia Disorder, and TBI | 9411 | 70 100 | Combat-related; Armed Conflict | No | 01/23 | 11/22 01/23 |
GERD w/IBS | 7319 7346 | 60 | Combat-related; Instrumentality of War - Gulf War Service | No | 01/23 | 11/22 |
Fibromyalgia | 5025 | 40 | Combat-related; Instrumentality of War - Gulf War Service | No | 01/23 | 11/22 |
Rhinitis | 6522 | 10 | Combat-related; Instrumentality of War - Gulf War Service | No | 01/23 | 11/22 |
Bilateral Tinnitis | 6260 | 10 | Combat-related; Instrumentality of War | No | 01/23 | 11/22 |
Erectile Dysfunction | 7599 7522 | 0 | Combat-related; Secondary Diagnosis | No | 01/23 | 11/22 |