Severance pay

J

jt2208

PEB Forum Regular Member
Registered Member
I received my rating, and the PEBLO told me that severance pay would be granted. How much money should I expect? I have spent nine and a half years in the Army as a Captain. Also, my rating for my unfit MEB was 10%. She advised that it would be deducted from my disability until full payment was repaid. How does that work, and how long should I expect to pay for it?
 
You can turn down the severance pay so that you don't get docked disability pay until its payed back. Its stupid as we all know but thats how it works.
 
you should get an election of options that you have to sign off on once you get your official findings.
 
jt2208 said:
I received my rating, and the PEBLO told me that severance pay would be granted. How much money should I expect? I have spent nine and a half years in the Army as a Captain. Also, my rating for my unfit MEB was 10%. She advised that it would be deducted from my disability until full payment was repaid. How does that work, and how long should I expect to pay for it?
Click to expand...
Army severance pay, or Involuntary Separation Pay (ISP), is calculated as 10% of the product of years of active service and 12 times the monthly basic pay at the time of separation. So in your case you're looking at around $90k. The VA disability pay is immediately collected dollar for dollar until it's collected so you'll receive $0 VA until it's fully recouped. Not sure if you have an option to take the severance or not, but I would say for you to take the lump sum due to the time value of money. However, I'm not sure how taxes will affect the severance. When I received severance pay (non-medical) I paid a hefty tax bill. Since VA money is tax free, it might be more advantageous for your to decline the severance.
 
I appreciate your answer, man. I had the same numbers but wasn't sure if that is how it works. It will take the VA approximately 2 years to recoup that money. I’ll definitely contact my PEBLO to certify the veracity of rejecting it.
 
For Disability Severance Pay it is two times your monthly base pay, times years of service. Also, before you decline it, be sure that you will actually be in the recoup category. There are SEVERAL ways to avoid having the money recouped. One example is my DOD was 20% but the VA was 100%. Even with the 20% condition subtracted my VA rating was 100%. Therefore, no deduction occurs. Declining DSP would have cost me $196k, if I took the advice of some. There are several other exemptions as well, such as Combat Zone, etc.
 
My dod is 10%, I asked if I could decline it and they said no. How can I avoid the deduction?
 
what was your overall VA percentage? and what would it be if you remove the referred 20% condition(s)?
 
100% without the recouping is 4,300, with the recoup is 3,800 since they only going to take that 10%. I see it like a loan pretty much!
 
jt2208 said:
100% without the recouping is 4,300, with the recoup is 3,800 since they only going to take that 10%. I see it like a loan pretty much!
Click to expand...
if that works out for you then that would be excellent. roughly $100k interest free loan that you "aren't even paying"
 
You must log in or register to reply here.
Top