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Updated May 28, 2024
Defense Primer: Concurrent Receipt of Military Retirement and
VA Disability
Concurrent receipt refers to a veteran’s simultaneous
compensation they are eligible to receive. As VA disability
receipt of two types of monetary benefits: military retired
compensation is nontaxable, waiving retired pay generally
pay from the Department of Defense (DOD) and disability
provides a net financial benefit.
compensation from the Department of Veterans Affairs
(VA). Prior to 2004, existing laws and regulations
CRDP authorizes military retirees with at least a 50%
stipulated that a military retiree could not receive both
service-connected disability as rated by VA to receive full
payments concurrently. As a result, military retirees with
military retired pay and VA disability compensation
disabilities recognized by VA would incur a retired pay
without offset (see Figure 1). There are currently two
offset (i.e., dollar-for-dollar reduction) by the amount of
groups of retirees who are not eligible for CRDP benefits.
their VA compensation.
The first group is non-disability military retirees with
service-connected disabilities (not combat-related) that
The FY2003 and FY2004 National Defense Authorization
have been rated by VA at 40% or less. The second group
Acts (NDAAs) authorized, for the first time, two separate
includes disability (Chapter 61) retirees with service-
and distinct concurrent receipt benefits, Combat-Related
connected disabilities and fewer than 20 years of service
Special Compensation (CRSC), and Concurrent Retirement
(YOS).
and Disability Payments (CRDP).
Figure 1. CRDP Eligibility Flowchart
An eligible retiree cannot receive both Concurrent
Retirement and Disability Payments (CRDP) and
Combat-Related Special Compensation (CRSC).
To be eligible for concurrent receipt under these programs
all recipients must be eligible for both (1) military retired
pay and (2) VA disability compensation. An eligible retiree
cannot receive both CRDP and CRSC. The retiree may
choose whichever is most financially advantageous to him
or her and may change benefit election during an annual
open season.
Table 1. Comparison of CRSC and CRDP
CRSC
CRDP
Source: CRS analysis of statute.
Classification
Special
Military retired
Notes: “Member” refers to a retired member of the Armed Forces.
compensation
pay
Temporary Early Retirement Authority (TERA) retirees are those
Qualified
Combat-linked
Service-connected
retired with less than 20 years of service due to force management
disabilities
disabilities
disabilities
requirements. Disability ratings are awarded in 10% increments.
Federal taxation
Nontaxable
Taxable
Combat-Related Special Compensation
Claim process
Apply to branch
Automatic
CRSC is considered special compensation and not restored
of service
retired pay. Under CRSC, the retired pay offset still applies
to receive VA disability compensation; however, CRSC
Source: Derived from Defense Finance and Accounting Service.
reimburses the member for some, or all, of the offset. The
Concurrent Retirement and Disability
amount of CRSC depends on the percentage of the
Payments (CRDP)
disability that is combat-related (CRSC rating) and may not
exceed the reduction in retired pay. These factors make the
CRDP was first authorized in the FY2004 NDAA (P.L.
calculation of CRSC more complex than CRDP, as every
108-136, §641), and was phased in over a 10-year period
veteran’s situation may be different. It may be easiest to
between 2004-2013. CRDP is sometimes referred to as
think of the total CRSC benefit as three separate payments:
restored retired pay, as it exempts certain members from
(1) retired pay from DOD minus VA disability payment
the offset of VA payments normally required under 38
based on VA rating; (2) VA disability payment based on
U.S.C. §§5404 and 5405. Under this offset, a retiree is
VA disability rating; (3) CRSC payment from DOD based
required to waive retired pay in the amount of VA disability
on combat-related portion of disability rating.
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Defense Primer: Concurrent Receipt of Military Retirement and VA Disability
The process for qualifying for CRSC is not automatic.
compensation from VA. As such, when Congress drafted
Retirees must apply to their parent military service, which
the CRSC legislation, it included a special rule for the
has the responsibility for verifying that the disability is
calculation of CRSC for Chapter 61 retirees. This rule caps
combat-related.
the concurrent receipt payment at the amount for which the
retiree would have qualified based solely on years of
Combat Eligibility for CRSC
service, or longevity. In some instances, the special rule
Military retirees may be eligible for CRSC if they have
could limit or completely eliminate the concurrent receipt
disability that meets either of the following two combat-
payment. In other instances, application of the rule may not
related criteria (see Figure 2):
result in any changes.
• The disability is “attributable to an injury for which the
Concurrent Receipt Funding
member was awarded the Purple Heart,” and is not rated
Military retired pay and CRSC are disbursed from the
as less than a 10% disability by VA; or
Military Retirement Fund. Contributions into the fund are
•
made by DOD through annual appropriations, and by the
The disability resulted from involvement in “armed
conflict,” “hazardous service,” “duty simulating war,” or
Treasury through intergovernmental transfers. A DOD
“through an instrumentality of war.”
Board of Actuaries determines how much DOD and
Treasury must contribute annually to cover future
Figure 2. CRSC Eligibility Flowchart
obligations. When Congress authorized concurrent receipt
in 2003 it included a provision that required the Treasury to
pay for the additional costs incurred by the expansion of the
benefit (10 U.S.C. §1466(c)(2)(D). In a December 2020
Report to the President and Congress, the DOD Board of
Actuaries expressed fiscal discipline concerns with the
current funding processes and recommended that “DOD,
not Treasury, should pay for all benefit increases.”
Issues for Congress
Several legislative proposals over the past few Congresses
have sought to expand concurrent receipt benefits to
military retirees not covered under existing CRSC and
CRDP provisions. In considering these proposals, Congress
may weigh both cost and equity arguments as well as the
larger package of military retiree, veteran, and social
security benefits available to this population.
Relevant Statute
Title 10, Chapter 71 of the United States Code, Computation of
Retired Pay
10 U.S.C. §1413a Combat-related special compensation
10 U.S.C. §1414 Concurrent retirement and disability payments
38 U.S.C. §5304 Prohibition against duplication of benefits
Source: CRS analysis of statute.
38 U.S.C. §5305 Waiver of retired pay
Notes: “Member” refers to a retired member of the Armed Forces.
Temporary Early Retirement Authority (TERA) retirees are those
retired with less than 20 years of service due to force management
requirements.
Other Resources
CRS Report R40589, Concurrent Receipt of Military Retired Pay
Special Rule for Chapter 61 (Disability) Retirees
and Veteran Disability: Background and Issues for Congress
Some individuals who have a permanent and stable medical
CRS Report R44837, Benefits for Service-Disabled Veterans
condition rated at greater than 30% by DOD may be
CRS Report RL34751, Military Retirement: Background and
disqualified from military service and are eligible to receive
Recent Developments
a pension from DOD prior to completing 20 years of
service. These individuals are sometimes called Chapter 61
Defense Finance and Accounting Service
retirees after the applicable section in Title 10, United
DOD Office of the Actuary
States Code. Historically, Congress has prohibited
individuals from receiving two separate lifelong
government annuities from federal agencies for the same
purpose or qualifying event (sometimes referred to as
Kristy N. Kamarck, Specialist in Military Manpower
double-dipping). This has been one argument for
IF10594
prohibiting Chapter 61 retirees from receiving disability
retired pay from the DOD concurrently with disability
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Defense Primer: Concurrent Receipt of Military Retirement and VA Disability
Disclaimer
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https://crsreports.congress.gov | IF10594 · VERSION 10 · UPDATED