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Combining Retirement and Disability Compensation

Military retirees who have service connected disabilities are eligible for disability compensation. The type and amount of disability compensation eligibility is based on several factors including the nature of the service-connected disability and the nature of your retirement. You may qualify for more than one program; however you may not receive benefits from more than one program at a time. The following will help you to determine which of these benefits you qualify for and which best suit your needs. 

Veteran Disability Compensation

If you are a military retiree with a service-related disability you may qualify for monthly benefit payments. These benefits are paid to retirees who are disabled by an injury or disease that occurred while on active duty, active duty for training, or was made worse by active military service. 

See chapter 12 for further eligibility payment rate details.

As a military retiree you may be required to waive a portion of your military retirement to receive these tax-free benefits. This reduction in military retirement pay is commonly referred to as a VA disability offset. Certain disabled military retirees may be eligible for one of the following programs that restore some or all of the VA disability offset.

Concurrent Retirement and Disability Pay (CRDP)

Concurrent Retirement and Disability Pay (CRDP) is a program that provides certain military retirees a monthly restoration of some or all of their VA disability offset. Qualified military retirees are those with 20 or more years of service who have a service-connected disability of 50% or more. When the CRDP program is fully implemented such members will no longer have their military retirement pay reduced by the amount of their VA disability compensation. 

Unlike the Combat Related Special Compensation (CRSC), CRDP is being phased-in (except for those retirees that have a VA rated, service-connected disability rating of 100%). The program began in 2004 and the phase-in will be complete in 2014. The phase-in is progressive. In 2007, the restoration of the offset pay was approximately 50%, by 2009 it will be nearly 85% complete.

You are eligible for CRDP if you meet the following criteria:

  • You must be a Military Retiree with 20 or more years of service, including:
    • Chapter 61 Medical Retirees with 20 years or more.
    • National Guard and Reserve with 20 or more - good years. (After drawing a retirement check at age 60)
    • Temporary Early Retirement Authority (TERA) Retirees with less than 20 years of service are also eligible.
  • Have a Service Related VA disability rating of 50% or higher.

Your CRDP payment is a restoration of retired pay. It is taxed and, if applicable, subject to collection actions for alimony, child support, community property, garnishment and government debt just as your retired pay.

Your monthly CRDP amount cannot exceed the lesser of your monthly gross retired pay or VA waiver amount. If you are a disability retiree whose retired pay is calculated using a percentage of disability rather than your years of service, your CRDP cannot exceed the amount your gross retired pay would currently be had it been calculated at retirement using your years of service

Fortunately you do not need to apply, CRDP is automatic. If you qualify you will automatically see an increase in your monthly retirement check.

Additional information is also available at the Defense Finance and Accounting Service (DFAS) web site: http://www.dfas.mil/ or the Office of the Secretary of Defense for Personnel Readiness web site: http://militarypay.defense.gov/

As noted above, your personal CRDP payment rate is determined by several factors. If you have questions you can contact the DFAS by calling toll free 1-800-321-1080 to learn about your personal CRDP payment rate.

Combat Related Special Compensation (CRSC)

Combat-Related Special Compensation (CRSC) provides military retirees a monthly compensation that replaces their VA disability offset.

To be eligible for CRSC, retired with combat related disabilities must meet the following criteria to apply for CRSC:

  • Must be receiving military retired pay under one of the following conditions: 
    • 20 years or more years of creditable Active-Duty service
    • National Guard and Reserve with 20 or more - good years. (After drawing a retirement check at age 60)
    • Chapter 61 medically retired (may have less than 20 years)
    • Temporary Early Retirement Act (TERA)
    • Temporary Disabled Retirement List (TDRL).
  • Must have 10 percent or greater (Combat Related) VA rated disability
  • Must have military retired pay offset by VA disability payments

Combat Related Special Compensation includes disabilities incurred as a direct result of:

  • Armed Conflict
  • Hazardous Duty
  • Conditions Simulating War
  • An Instrumentality of War

Unlike Concurrent Retirement and Disability Pay (CRDP), CRSC has no phase-in period. Once a military retiree has been determined to be qualified they will receive their reduced retirement pay plus an additional sum that makes up for part or all of their offset retired pay.

Your CRSC payment is based on percentage of your disability that your Service determines to have been combat related as described above. This percentage may be less than your overall VA disability rating, and consequently the CRSC payment may be less than your offset retired pay.

Your CRSC payment is not a restoration of retired pay. It is a special entitlement payment and is not taxed.

Your monthly CRSC amount cannot exceed the lesser of your monthly gross retired pay or VA waiver amount. If you are a disability retiree whose retired pay is calculated using a percentage of disability rather than your years of service, your CRSC cannot exceed the amount your gross retired pay would currently be had it been calculated at retirement using your years of service

Unlike CRDP, CRSC is not automatic; you will need to apply to your military Service. If you qualify your Service will advise you of your status.

Your eligibility is determined by several factors. To learn more about the specific eligibility criteria and how to apply, visit one of the following websites:

AIR FORCE CRSC
United States Air Force
Disability Division (CRSC)
550 C Street West Ste 6
Randolph AFB TX 78150-4708
Phone: 1-800-616-3775
Website: http://www.afpc.randolph.af.mil/library/combat.asp

ARMY CRSC
Department of the Army
U.S. Army Physical Disabilities Agency/
Combat Related Special Compensation (CRSC)
200 Stovall Street
Alexandria, VA 22332
Phone: 1-866-281-3254

Email: crsc.info@us.army.mil

Website: https://www.hrc.army.mil/site/crsc/index.html

COAST GUARD CRSC
Commander (adm-1-CRSC)
U.S. Coast Guard
Personnel Command
4200 Wilson Boulevard
Arlington, VA 22203-1804
1-800-772-8274
Website: http://www.uscg.mil/hq/cgpc/adm/adm1.htm

NAVY and MARINE CORPS CRSC

Secretary of the Navy Council of Review Boards
Attn: Combat-Related Special Compensation Branch
720 Kennon Street SE, Suite 309
Washington Navy Yard, DC 20374
Website: http://www.donhq.navy.mil/corb/crscb/crscmainpage.htm

Additional information is also available at the Defense Finance and Accounting Service (DFAS) web site: http://www.dfas.mil/ or the Office of the Secretary of Defense for Personnel Readiness web site: http://militarypay.defense.gov/.

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