CRSC help

B

Busybilly118

PEB Forum Regular Member
Registered Member
I was MEBd 2 years ago, I have over 20 years active and went from the TRDL to the PRDL recently. Some of my MEB related injuries are cmbat related, I was thinking of applying for CRSC. Is it worth it? Also , I do not understand why I have to pay $600 a month on
My retired pay for “VA waiver”?
Thanks
Ryan
 
Busybilly118 said:
I was MEBd 2 years ago, I have over 20 years active and went from the TRDL to the PRDL recently. Some of my MEB related injuries are cmbat related, I was thinking of applying for CRSC. Is it worth it? Also , I do not understand why I have to pay $600 a month on
My retired pay for “VA waiver”?
Thanks
Ryan
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Your inferred current status.

Entitlement Amount (for Retirees Who Are Entitled to Retired Pay Due to Retirement Under Chapter 61 for Disability):​

A military disability retiree with more than 20 years of creditable service for retirement must still waive retired pay in order to receive VA Disability Compensation. The waiver amount is the amount that the military disability retired pay exceeds the amount of military retired pay to which the member would have been entitled to receive if the member had hypothetically been retired under another law (such as the law that permits voluntarily retirement based on longevity/years of service). As a result, the amount of military disability retired pay that a disability retiree may receive concurrently with VA Disability Compensation may be limited. (Disability retirees who retired before December 31, 2013 were also subject to the phase-in described above).

Example: A regular component service member is retired under Chapter 61 for disability in 2020 after completing more than 20 years of creditable service under 10 U.S.C. § 1405. The member is also entitled to VA Disability Compensation based on a service-connected disability that is rated by VA as 50 percent disabling. This member may only receive concurrent military disability retired pay in an amount equal to what the member would have hypothetically received had the member retired for longevity/years of service. Any remaining amount of military disability retired pay is still subject to the waiver requirements of Title 38 United States Code (U.S.C.), sections 5304 and 5305.

Note: For Reserve/Guard members who receive their Notification of Eligibility for Retired Pay at Age 60 (“NOE”) and are later retired under Chapter 61 for disability with immediate retired pay, concurrent retired pay may not be paid until the member reaches the eligibility age that (s)he otherwise would have been required to reach in order to start receiving military retired pay. This is because there is no provision of law under which such a member would be entitled to receive retired pay before eligibility age if the member had not been retired under Chapter 61 for disability.

Ron
 
Busybilly118 said:
That's great info Ron, it makes little sense to a dipshit like me….
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Basically, your maximum from DFAS is the hypothetical longevity portion of retired pay.

“The waiver amount is the amount that the military disability retired pay exceeds the amount of military retired pay to which the member would have been entitled to receive if the member had hypothetically been retired under another law (such as the law that permits voluntarily retirement based on longevity/years of service).”

Ron
 
Busybilly118 said:
So its not worth applying for CRSC
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It depends.

CRSC is nontaxable. Generally, I recommend to those qualified for CRSC and Concurrent Military Retirement Pay and DVA Disability Compensation (formerly known as CRDP) to choose CRSC if the percentage and amount is equal to the amount payable for Concurrent Military Retirement Pay and DVA Disability Compensation.

You won’t know unless you apply.

Note: CRSC will never be more than the Concurrent Military Retirement Pay and DVA Disability Compensation “CRDP”, but could be less.

Ron
 
Busybilly118 said:
I was MEBd 2 years ago, I have over 20 years active and went from the TRDL to the PRDL recently. Some of my MEB related injuries are cmbat related, I was thinking of applying for CRSC. Is it worth it? Also , I do not understand why I have to pay $600 a month on
My retired pay for “VA waiver”?
Thanks
Ryan
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The basic answer is CRSC isn't worth it unless you think you will get 100% CRSC. You are maxed out with your regular pension and VA compensation. You MIGHT be able to net more income if you are approved for CRSC for the exact amount that you receive 100% VA disability. That is because CRSC is tax free.

I don't think its worth it for most everyone that has a 20 year retirement.
 
During my own CRSC adventures, I took CRSC for a period when my CRSC was not 100%, I have a regular retirement (i.e. 20+ AD). I had other substantial taxable income that made the CRSC nontaxable choice = more net to me.

Ron
 
RonG said:
During my own CRSC adventures, I took CRSC for a period when my CRSC was not 100%, I have a regular retirement (i.e. 20+ AD). I had other substantial taxable income that made the CRSC nontaxable choice = more net to me.

Ron
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That would put you in the very small minority. Most people aren't in career finance and couldn't figure that out if they tried. You would have to know and calculate 2 different scenarios to see which one would net you more money. That's with each scenario having a different gross income.
 
Provis said:
That would put you in the very small minority. Most people aren't in career finance and couldn't figure that out if they tried. You would have to know and calculate 2 different scenarios to see which one would net you more money. That's with each scenario having a different gross income.
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You are correct. The possibility of some benefiting from the alternative selection is also accurate, albeit for a small population.

My motive was to point out that it does exist. The calculations you spoke of were part of my process. Of course, most of the CH 61 CRSC cases on this board also include many who evidently cannot compute the benefit for themselves. I am glad we can help.

I am not a tax expert and do not compute taxes for anyone except family members.

Regards,
Ron
 
Provis said:
That would put you in the very small minority. Most people aren't in career finance and couldn't figure that out if they tried. You would have to know and calculate 2 different scenarios to see which one would net you more money. That's with each scenario having a different gross income.
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How do you know if your 100% CRSC, I MEBd and am on the PRDL with 60% but it was combat related injury…..not sure if its worth it
 
Busybilly118 said:
How do you know if your 100% CRSC, I MEBd and am on the PRDL with 60% but it was combat related injury…..not sure if its worth it
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Your CRSC approval letter from your service shows the percentage and effective date. CRSC is a replacement of some or all waived retired pay due to receipt of VA compensation.

Ron
 
I've heard from a few sources that I should apply for CRSC and that DFAS will "pay whichever is more to the retiree" - my finance meter went up to 100% as I've never heard of DFAS picking to pay more on purpose. I'm transitioning now and seeking employment - The tax implications are not something I've considered...was that something you worked out yourself or sought the help of a financial advisor. I've been told by more than one person to see professional finance advice post Army, specifically due to taxes.
 
jhanley said:
I've heard from a few sources that I should apply for CRSC and that DFAS will "pay whichever is more to the retiree" - my finance meter went up to 100% as I've never heard of DFAS picking to pay more on purpose. I'm transitioning now and seeking employment - The tax implications are not something I've considered...was that something you worked out yourself or sought the help of a financial advisor. I've been told by more than one person to see professional finance advice post Army, specifically due to taxes.
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Do you already have a 20 year retirement earned and at least a total of 50% or higher VA rating? If so, your maxed out compensation. If you apply for CRSC you would need to get the same VA total % plus any SMC's approved for CRSC to have CRSC match what you are getting now. If that is the case DFAS will choose CRSC over concurrent receipt of VA pay since CRSC is exempt from taxes.
 
Provis said:
Do you already have a 20 year retirement earned and at least a total of 50% or higher VA rating? If so, your maxed out compensation. If you apply for CRSC you would need to get the same VA total % plus any SMC's approved for CRSC to have CRSC match what you are getting now. If that is the case DFAS will choose CRSC over concurrent receipt of VA pay since CRSC is exempt from taxes.
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Thanks, you so much for the clear explanation. I'll def take a look at this @ 29 years AFS/100% P&T this may apply - as far as I can tell from the VA letters provided all are combat related.
 
jhanley said:
Thanks, you so much for the clear explanation. I'll def take a look at this @ 29 years AFS/100% P&T this may apply - as far as I can tell from the VA letters provided all are combat related.
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Depending on your tax bracket situation in rare circumstances it has been advantageous to choose CRSC over CRDP even if CRSC is lower because you would net more compensation from CRSC compared to CRDP after taxes are paid. If that's the case you will need to run the numbers and choose CRSC instead of leaving it by default for the other option which is a higher gross pay.
 
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