Dividing military retirement benefits is one of the trickiest elements
of a divorce. In my experience, attorneys often will simply avoid the
possibility of messing up the division of military retirement benefits
by ceding all benefits to the recipient spouse. In fact, some attorneys
don't even know how to property calculate the value of these benefits.
The first step to dividing military retirement benefits is to know the
rules. The rules can be found in the Uniformed Services Former Spouse's
Protection Act. The military loves acronyms so let's call it the "USFSPA".
The USFSPA is found at 10 U.S.C. 1408. The act allows the states to divide
up military retirement benefits per state rules. The USFSPA also delineates
the Survivor Benefit Plan ("SBP"), which is an annuity program
that allows the former spouse to continue receiving regular military retirement
payments after the service-member/retiree dies. The SBP portion of the
USFSPA is found at 10 U.S.C. 1447.
The second step to dividing military retirement benefits is to obtain the
documents that show the value. A good attorney may need to obtain numerous
documents to obtain this value, including a "Leave and Earnings Statements"
(for active duty members), a "Retirement Points Statement" (for
reserve and guard members) and a "Retiree Account Statement"
(for retirees). Also of interest are SBP election forms, retirement orders,
discharge papers and Officer or Enlisted Record Briefs.
The third step to dividing military retirement benefits is to identify
the correct valuation system to be used. Active-duty retirement occurs
under one of three valuation systems: (a) final retired pay or (b) high-3
or (c) CSB/Redux. These can currently be found
Reserve and National Guard retirements are based on retirement
points, not on time served. And the service-member must have 20 "good years"
of service to be retirement eligible. A "good year" is one with
at least 50 "points".
Also, Reserve or National Guard retirements generally pay out when the
retiree reaches 60, while active-duty retirement plans pay out immediately
upon retirement. The cost of providing SBP coverage to a former spouse
can also differ depending on whether the service-member has an active
duty or reserve retirement.
As always, speak to your attorney before making any decisions in this area.
Many rules have exceptions and some exceptions have exceptions.