Severance Pay recoupment information. Must Read!!

R

Ralphmac

PEB Forum Regular Member
PEB Forum Veteran
Hello Vets,

I was doing some research and stumbled upon this website.

Separation Recoupment FAQs

It states the the most they can recoup from your DOD retirement pay is 40%. Hopefully, most of you have paid off your severance through VA already. I was originally rated at 10% then raised to 70%, so the VA has only been taking 10% of my disability reward to pay back the severance. It also states that we will need to get a statement from the VA to let DOD know how much they have collected. I was discharged almost four years ago, so my back retirement pay will pay off quite a bit of what I owe. The website also includes a phone number to call. I'm curious how all of this plays out.

Mac
 
Ralphmac/Jason,

I am curious of your thoughts on my situation. I was discharge in July 2003 with 10%. Six months after discharge I was given 70% from the VA which was February 2004. My recoup started in March 04 but i was getting about $800 a month. Two years later my rating went to 80$ and then 90%. My severance pay was finally paid off on January 2010 and started receiving a full payment from the VA in 02/2010. The original amount i believe 30K. With help and guidance and a little pushing I submitted my packet to the PDBR in October. My question i have is since i have already paid off the severance and IF I am retired how does this effect me. I have a strong feeling that I should get my money back and from the things i have read the VA and DOD have no idea how to go about this. But based on your findings and wisdom what is your opinion. Jason if you want to give your thoughts please do so. This is the hardest part about understand this and my wife is trying to understand as well. Some how some way they have to give your money back. There are a lot of What If's and really no hard information or evidence to lean on. I await your thoughts!!!
 
CommoSgt,

By the way, I was a Commo Sergeant in the Army 25W. Anyways, if you are retired through the PDBR and hopefully you get that, I would assume you would get all of your retirement back pay from the date of discharge. However, you would not get the severance pay back because that belongs to the government. The reason I say that is because since you paid it all back you are no longer in debt to the government if you are retired through the PDBR. So, I would assume based upon what I have read you will get the retirement back pay, which will probably be a nice check when and if you get retired. I would look at this as a good thing considering all the severance was paid off ahead of possible retirement. If you are not retired, you still get a nice check from the VA with no deductions. I'm by no means a lawyer or an expert, but these are my opinions and what I would believe would happen in your case. I just sent an email to DFAS explaining my situation and I'll post when I have an answer.
 
Ralphmac,

Thank you for your thoughts and wisdom. I was an old 31K, then 31U, and finally 31W before that 11B, with Ranger Tab, and 13B. I moved around a lot, crossed train in 91B (medic). Not sure if those changed or not....been a long time. I am suffering from all the fun I had but I try to keep in shape as often as i can when time permits. My new thing is Modern Arnis. Anyway, I and sure everyone appreciates your thoughts and wisdom. I have more wisdom on the VA side of things than I do this (PDBR). I am learning as I go!!!
 
I am curious though as my better half asked. How would they determine back pay and what would the formula be to determine this??
 
Yeah, all the 31 series MOS's became 25 series and they phased quite a few of those MOS's out. Anyways, I would assume that your retirement back pay would be whatever % percentage over or at 30% the PDBR determines minus taxes and things like that times the number of months since your separation. It states on my letter that back pay will be paid from time of discharge which was almost four years ago. Of course my back pay will go to pay back the severance, woo hoo. I'm sure it gets a little more tricky if your disability was related to combat or not. As I said, I'm no expert but I would guess that this would be your situation, which is not a bad one when you get retired. My next question is would the DOD communicate with the VA to determine whether or not severance was paid back or not? Hopefully, this has been discussed and they won't deduct severance from retirement back pay that was already collected from the VA. If I were you I would request a statement from the VA stating that severance was paid off so you will have documentation once you get retired to avoid any confusion the VA and DOD may have.

Thanks,

Mac
 
Ralphmac, I requested that information about two weeks ago. Still waiting on it. I did post some info about that as well as the write up for requesting that information. Hopefully soon I will receive it and more than likely post it here, of course line out the identity stuff for my security.
 
Good Morning Commosgt,
I'm with the same boat like you. I'm retired by the PDBR w/ 50 %. Was dx back in 7/2004. Severance was paid off. I was told by others that i should be getting backpay from the army from date of discharged. I call DFAS but the lady i was talking to said that since the VA pension is higher than my retired pay, it will be offset. But, I don't trust was she told me. Please let me know if you'll here nything from them. And i hope you get what you deserve and all the Vets with the same situation. Pls PM me if u dont mind.

By the way modern arnis/ eskrima is a good self defense. My grandfather use to teach me that and "kali". Broke my left middle finger during sparring. Take Care and God Bless! Pls Keep in Touch...
 
Have you applied for CRCS or CDRP? You should rate one of those also if retired by PDBR. One is for combat relate the other is for non combat if I'm not mistaken. Should be around $500 a month from what I've heard.
 
PMI0369 said:
Have you applied for CRCS or CDRP? You should rate one of those also if retired by PDBR. One is for combat relate the other is for non combat if I'm not mistaken. Should be around $500 a month from what I've heard.
Click to expand...
PDBR action to retire you does not automatically equate to CRSC/CRDP eligibility. CRSC is based on combat-related injuries, CRDP applies to those with 20 or more years of service.
 
jtol76,

Unfortunately, I think the lady at DFAS is correct. If you are a chapter 61 retiree (which means you are not eligible for concurrent receipt of retired pay and VA compensation) you may elect to receive the tax benefit of reducing your taxable military retirement pay by your VA compensation. This is the offset the lady at DFAS and others have discussed. Only those whose military retirement is less than their VA compensation receive a military retirement check from DFAS. That being said, I don't believe you will be getting any backpay since your VA compensation is higher than your military retirement pay. What this means is that even if you had originally been retired you would not have received a retirement check from DFAS, only VA compensation. I also believe this means that you will not recover severance pay either. Severance pay can be thought of as a cash advance of VA pay, which is paid of through reduced VA compensation. Are you eligible for CRSC (combat-related injuries/disability)? If so, the situation may be a little different as I don't yet have a firm understanding of that process/program.

As always anyone with better information chime in.

--brnt
 
All,

This is the part of this whole thing that I am still in the dark about. I am waiting to see if the PDBR will retire me and I received about 55K severance pay in 2007. Like all of you my VA compensation is being reduced monthly to "pay back" the disability severance (which is a whole subject in itself and is another way that vets like us are being screwed by the government because the disability severance is compensation for loss of a military career and VA disability compensation is for loss of future earnings in the civilian sector...ughhhhh, don't get me started!!!) Anyway, when the PDBR does finally come back with a decision to retire me (gotta think positive), how will the CRSC play into all of this? Since I will still "owe" money to the VA from my severance payment, how will that all play out? My original board decisions rated my injuries as "combat related" so I think that part is covered as far as CRSC is concerned but I don't know how that will affect the financial ledger. By the way, just to throw in my two cents, this darn government needs to approve concurrent receipt for disability retirees....nuff said.

Kevin
 
Kevin,

First, I am not an expert on this stuff and have limited knowledge of the CRSC stuff. I believe CRSC pay is not offset by VA pay and you should be able to collect back pay on that. You may also be entitled to retirement back pay. We can do a little research on your ratings and see where you stand regarding retirement back pay. What was your rank and time in service at discharge in 2007? What is your VA rating? If you are not comfortable posting these items, just shoot me a PM.
 
i have a question for ya or anyone else that can help. i am on TDRL with the army. they gave me a lousy 40% when i went through the MEB and the VA gave me 90% for the same SC injuries all SC. when i return for my 18month exam, if i get below 30% the army will give me severance pay and separate me from the army. heres the question. what will happen to my 90% with the VA? will i still get the same rate of pay from the VA. or is this another area where the army is going to screw me over again?

thanks for helping any one
don
 
brnt said:
jtol76,

Unfortunately, I think the lady at DFAS is correct. If you are a chapter 61 retiree (which means you are not eligible for concurrent receipt of retired pay and VA compensation) you may elect to receive the tax benefit of reducing your taxable military retirement pay by your VA compensation. This is the offset the lady at DFAS and others have discussed. Only those whose military retirement is less than their VA compensation receive a military retirement check from DFAS. That being said, I don't believe you will be getting any backpay since your VA compensation is higher than your military retirement pay. What this means is that even if you had originally been retired you would not have received a retirement check from DFAS, only VA compensation. I also believe this means that you will not recover severance pay either. Severance pay can be thought of as a cash advance of VA pay, which is paid of through reduced VA compensation. Are you eligible for CRSC (combat-related injuries/disability)? If so, the situation may be a little different as I don't yet have a firm understanding of that process/program.

As always anyone with better information chime in.

--brnt
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brnt,

You're right about the severance pay, it is an overpayment once one gets retired and won't be recouped by the retiree. I know it stinks but it's the way the law is.
 
"My next question is would the DOD communicate with the VA to determine whether or not severance was paid back or not?"

I was separated in March 05 with severance pay and a 10% rating. I didn't receive a decision from the VA until November 07 with a rating of 50%. I didn't apply to the VA until September 06 so it took a little over a year. I was retro paid to the date in 06 when I applied. The VA took back my whole severance pay from the retro pay. It is stated in my award letter from the VA that the severance pay was paid in full. I sent that paper in with my PDBR application with that highlighted so they know. If the VA has taken it back in some way..... There should be documentation that says so. I was told at the time of separation "don't bother applying for VA benefits because a 10% rating is too low to get anything" That's why I waited so long.

I sent in my PDBR application in Aug 10 and got a letter dated 10 NOV 2010 stating that it was sent to the Central Adjudication department. Hopefully it won't be too long until I receive the decision on my retirement. Does anyone know how long it takes in the adjudication stage?
 
mahenry2582 said:
"My next question is would the DOD communicate with the VA to determine whether or not severance was paid back or not?"

I was separated in March 05 with severance pay and a 10% rating. I didn't receive a decision from the VA until November 07 with a rating of 50%. I didn't apply to the VA until September 06 so it took a little over a year. I was retro paid to the date in 06 when I applied. The VA took back my whole severance pay from the retro pay. It is stated in my award letter from the VA that the severance pay was paid in full. I sent that paper in with my PDBR application with that highlighted so they know. If the VA has taken it back in some way..... There should be documentation that says so. I was told at the time of separation "don't bother applying for VA benefits because a 10% rating is too low to get anything" That's why I waited so long.

I sent in my PDBR application in Aug 10 and got a letter dated 10 NOV 2010 stating that it was sent to the Central Adjudication department. Hopefully it won't be too long until I receive the decision on my retirement. Does anyone know how long it takes in the adjudication stage?
Click to expand...


mahenry,

Yes, the VA and DFAS do communicate with each other. It might not be good but they do talk. DFAS is the payroll provider for the DVA.
 
There are two bills in the house right now adressing that very thing. you can find it at govtrack or something like that
Orion69 said:
All,

This is the part of this whole thing that I am still in the dark about. I am waiting to see if the PDBR will retire me and I received about 55K severance pay in 2007. Like all of you my VA compensation is being reduced monthly to "pay back" the disability severance (which is a whole subject in itself and is another way that vets like us are being screwed by the government because the disability severance is compensation for loss of a military career and VA disability compensation is for loss of future earnings in the civilian sector...ughhhhh, don't get me started!!!) Anyway, when the PDBR does finally come back with a decision to retire me (gotta think positive), how will the CRSC play into all of this? Since I will still "owe" money to the VA from my severance payment, how will that all play out? My original board decisions rated my injuries as "combat related" so I think that part is covered as far as CRSC is concerned but I don't know how that will affect the financial ledger. By the way, just to throw in my two cents, this darn government needs to approve concurrent receipt for disability retirees....nuff said.

Kevin
Click to expand...
 
commosgt said:
Ralphmac, I requested that information about two weeks ago. Still waiting on it. I did post some info about that as well as the write up for requesting that information. Hopefully soon I will receive it and more than likely post it here, of course line out the identity stuff for my security.
Click to expand...

Where did you send the request the information about severance repayment check? I was increased to 100% June 2010 and they took my original severance out of it before giving me the back payment. Two weeks ago, I was medically retired at 40% and am trying to determine if they are going to give me any type of back pay for it. I do not think they are since my 100% is considerably more, but figured I would ask. Thanks for all of your help.
 
I can only offer my experience with severance, PDBR, VA, DFAS, and CRSC. I was 20% severance, Army, 2009, combat injuries. So the rules under NDAA 2008 were in full effect...no deductions made due to the combat criteria. I did get full severance without deductions. I was retired by the PDBR with 30% in Oct 2011. I was paid full retro retirement by DFAS in January 2012, wasn't much, however, there were NO deductions made regarding the severance. DFAS sent me an itemization of my retro retirement pay, detailing the amounts. I applied for CRSC in FEB 2012, and was approved in FEB 2012. I recieved 24 months of retro active CRSC pay in MAY 2012. So up to this point (SEPT 2012), I have never been notified by DFAS, VA, or CRSC Branch that there may be a repayment of severance issue.

Ratings:
Dept Army thru PDBR @ 30%.
Combined Dis Rating VA @ 40%.
CRSC @ 40%.
 
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